Why Do Some Parents Not Want To Pay For Child Support?

Posted by: Gerald A. Maggio, Esq.

Top Orange County divorce mediators; California divorce mediatorsA major aim of a professional mediator is to guide and assist the parents to keep the best interests of their kids in mind. A significant decision, which affects the kinds involved in the divorce, is the amount of money to be paid as child support to the parent who gets their custody from the court. How this amount gets calculated may vary from state to state and depend on the total number of kids of the marriage.

Goal of a mediator

The key goal of a mediator is to make sure that the final child custody amount to be paid is agreed upon by both the parents. The trick to arrive at this agreement is to ensure that the parent held accountable for the child support payment gets a proper buy-in in the course of the decision-making process.

Reasons for not paying for child support

A common reason why many people do not pay the stipulated child support money is that they are not convinced that the amount they should be paying will help in supporting their kids. Another key reason for refusing to pay is many people find it difficult to digest when a lawyer or the judge tells them to pay for child support and determine the amount and frequency.

Many are under the misconception that disputes related to child support are only restricted to divorces with high conflict. However, in reality, that is incorrect. Even while the two parties are having an amicable divorce, issues related to child support can be a big headache. A parent may feel it highly frustrating to hand over their hard earned money to the former spouse and yet enjoy no authority over the exact allocation of that money. When there is uncertainty about how the funds will be exactly spent, it will be difficult to feel inspired enough to pay the amount for child support and also paying it regularly.

The key issue mostly originates when a spouse does not have an adequate say in the exact amount of child support. If lawyers, judges or other stakeholders go about making such decisions, the said spouse may not be fully convinced always. On the other hand, if the person concerned is given some say to shape up the decision, they would definitely be more willing to adhere to such a plan of child support. When a payer gets privileges related the kind of child support payment they need to pay and how the money will be used, they are motivated and try to pay the agreed upon payment for child support. Thus, it is crucial for the couple to set up an initial agreement and make sure that it works out successfully.

To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation

Options for Filing Tax Returns After Divorce

Posted by: Gerald A. Maggio, Esq.

Orange County divorce mediation; California Divorce MediatorsRecently divorced individuals can often be faced with new challenges and problems that did not exist previously. One of them is tax filing. Married couples can file for tax either jointly or separately. Usually, the tax filing status of couples is done jointly. In California, couples only have the option for joint filing but divorced individuals can do it separately if they obtain a final decree of divorce by the end of the tax year.

If the final divorce decree is obtained before the end of the tax year, each partner has the option of filing the tax return as single or head of household. They follow the same tax rules as legally separated couples.

Filing as head of household

A head of household is a person who is unmarried and takes care of the house expenses. Those who qualify for head of household should file as such because the effective tax rate is lower than those who file as single individuals. It also protects one from joint tax liability that might arise due to the other spouse’s error.

One of the advantages of filing as head of household after divorce is that it does not require the other spouse to itemize things.

Filing joint and separate returns

In California, only married couples are allowed to file a joint return. It may not be applicable for legally separated couples and individuals should check the state tax laws first before filing a tax return. According to federal tax rules, a marriage is one where a legal union exists between two individuals. It does not matter which state the individuals belong to as long as their marriage took place in California. The state law also controls whether couples are legally separated or divorced under separate maintenance decree.

Joint returns can be filed by couples who are legally separated but still married. Separate returns can also be filed by both individuals.

Filing tax returns can be confusing and difficult after a long and tough divorce. It requires the individual to understand the state tax laws and file for returns accordingly. California state laws require couples to file tax returns jointly. Divorced individuals can file separately provided the final divorce decree has been passed by the end of the tax year. Legally separated couples can file jointly or separately. Tax rates can increase or decrease, depending upon how it is being filed and in what condition.

To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation

Understanding Child Support & Taxation Issues

Posted by: Gerald A. Maggio, Esq.

Divorce mediators in Orange County; California Divorce MediatorsAs per the federal law, the child support contribution is stated as tax- free for deductions under the income tax guidelines. The aforementioned law implies that both the recipient parent and the child are exempted from any taxes on the funds they receive as child support. On the other hand, the federal law states that spousal support payments are tax-deductible for the individual making the payments, and the amount is also taxable to the one who is receiving the funds. However, the child support funds do not fall under the tax deductible category for the one who makes the payment.

What counts as child support?

The separation or divorce agreement needs to have a clear cut distinction between, what is being paid and received as alimony, and what is to be considered as child support. Many a times, the divorce agreement does not display a clear demarcation between the alimony and child support , and clubs both the categories together as family support payments. Such a situation is detrimental to the parent receiving the child support payments, as the alimony or family support is considered as a taxable income for the recipient. In these cases, the custodial parent might actually end up paying taxes on the child support income, irrespective of what the funds are actually being used for. 

Which of the parent can claim the child as a dependant?

As per the law, a parent contributing to at least 50 % of his child’s support, during a fiscal year, is qualified to claim the child’s dependency on his taxes. It is quite an effective tax saving technique, employed by married couples who are living together. However, when the parents separate or take a divorce, things get more complicated. Post a divorce or a separation, only one of the two parents can benefit from tax exemption arising out of a child’s dependence on him. The Internal Revenue Service practices stringent laws when it comes to both the parents illegally claiming the child’s dependence on their taxes. 

Child dependency in the case of unmarried parents

In case the parents have been living together for more than six months, and have not been married yet, the dependency of the child can be claimed by the parent who provides more than half of the child support during a tax year. However, if neither of the parents is able to provide more than 50 % of the child support, the matters end up getting further complicated.

In such cases, it is always advisable to obtain legal consultation from a professional attorney who is better equipped to deal with the case as per your specific situation.  To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation