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Unemployment and Child Support

How does unemployment affect child support?

Unemployment and child support are related. It can result in lower child support payments. However, this will depend why you are unemployed. Were you laid off, or were you fired? Did you quit your job, or were you injured? Are you in treatment or in jail?

The Court will look at whether you are unable to find work, or if you are voluntarily underemployed.

Laid off and collecting unemployment

If you were laid off by your employer, then you are probably OK. Your unemployment benefits are considered your income. The benefit is usually   Continue reading “Unemployment and Child Support”

What is my income for child support?

By Steve Harton

Child support in Wyoming is calculated using parents’ net incomes. Net income is calculated by subtracting some deductions from a parent’s gross income. In this post I will explain what is income for child support purposes.

Definition of income for child support

Income means any form of payment or return in money or in kind to an individual, regardless of source.

What is included in income?

Income includes all sorts of things. Some are obvious, some are not. Here Continue reading “What is my income for child support?”

Net Income for Child Support Calculation

In Wyoming, the courts use net income for child support calculations. Net income is not the amount you see on your paycheck. It is not the amount that gets direct deposited into your account.

What is Net Income for Child Support Calculations?

Net income is your gross income less certain deductions. These deductions are set out in Wyoming Statutes Section 20-2-303(a)(iii). The are as follows:

Personal income taxes

These are state and federal income taxes that you pay. The taxes must be based on your actual situation. You cannot claim more income taxes than you should actually be paying. In other words, if you are married and have two kids, you cannot claim zero exemptions. That would increase your withholding, and result in a big tax refund. Therefore, you did not actually pay that much in income taxes.

Social Security deductions

This is pretty much self explanatory. This would also be the railroad retirement deduction you have if you work for the railroad.

Cost of dependent health care coverage for dependent children

This deduction is the actual amount the coverage costs for the children. It is not necessarily the amount that gets deducted on your check, because that probably includes coverage for yourself. However, it does include premiums for dental and vision coverage.

Actual court ordered support payments for other children

This is a court ordered child support obligation for other children. In order to deduct this, you must actually be paying the other support obligation.

Payments for back child support or arrearages are not deductible.

Mandatory pension deductions

Some companies and government agencies still have mandatory pensions. Your mandatory contributions to these programs are deductible. (This includes union dues, which are a sort of mandatory retirement deduction). However, 401k and IRA contributions are not deductible, because they are not mandatory.

Conclusion

Determining your net income for child support purposes is not as easy as looking at your check. There are a lot of “normal” payroll deductions that are not deducted for child support, such as disability insurance, 401k, etc.

How can we help?

Here at WYeLawyers, we can look at your pay, and accurately calculate your net income for child support. Even if you are representing yourself, we can help you this part right. So take the next step and set up a consultation by calling 307-382-5545.

By Steve Harton

Additional Resources

 

Divorce with Children

A divorce with children in the house raises several issues. Among them are:

  • Where can you file?
  • Where will the kids live?
  • What kind of visitation will the other parent get?
  • How much child support?
  • Who provides health insurance?
  • How will the parents split medical expenses?

Where can you file for divorce with children?

Generally, you should file in the state where the children live. That’s usually the home state of the children. The home state of the kids is important, because only a court in the children’s home state can enter custody orders.

Where will the kids live?

In Wyoming, we call this physical custody. It is different from legal custody. There are three types: primary, shared and split.*

Divorce with children whose parents disagree on custody is difficult and expensive.

Where the kids live will determine which parent pays child support to the other. Shared and split custody arrangements will greatly reduce the amount of support.

What kind of visitation will the other parent get?

Standard visitation is generally as follows:

  • Every other weekend
  • Alternating holidays
  • Half of the summer

The standard visitation schedule is applicable for all custody arrangements. However, it can be, and often is, modified to meet the specific needs of the parents.

When one parent has primary custody, the other parent will be awarded visitation.

When parents have shared physical custody, the court will usually award each parent alternating holidays.

If parents have split physical custody, the parents usually get the standard visitation schedule. However, all of the children will be together on holidays, weekends and in the summe.

How much child support?

Child support is based on the net income of each parent. The net incomes are then plugged into a formula. The formula then determines the joint support obligation, and each parent’s share of the joint amount.

When one parent has primary physical custody, then the other parent pays their share of the joint obligation to the custodial parent.

When parents share physical custody, then the amounts are adjusted by the percentage of time the kids spend with each parent.

In split custody arrangements, the formula calculates how much each parent should pay to the other. Then the parent that owes the most, will pay the difference to the other.

To see how this formula works, go to this child support calculator.

Who provides health insurance?

In Wyoming, each parent is required to provide health insurance for their minor children, if available at a reasonable cost.

Reasonable cost has been defined as less than 5% of the parent’s gross income.

If both parents can provide insurance, then both will have to do so. Even if there is double coverage.

If neither parent can provide insurance, then the custodial parent will have to apply for KidCare of Medicaid.

How will parents split medical expenses?

The parents of divorced children are require to contribute to the children’s medical support. This is includes health insurance coverage. It also includes out of out of pocket costs.

Out of pocket costs are generally shared. However, when one one parent earns much more than the other, some courts will order the parties to share the cost in proportion to their incomes.

Conclusion

As you can see, a divorce with children raises several important issues. These issues have to be litigated or negotiated, and the terms need to be included in the divorce decree. In addition, income withholding orders notices to employers must be prepared. That is why a divorce is more expensive when children are involved.

How can we help?

Here at WYeLawyers, we have helped hundreds of people get divorced. We can represent you through the entire process. Or, we can help you take care of specific parts of your divorce. Like drafting the Complaint or an Answer and Counterclaim. Advising you on custody proposals. Calculating child support. So take the next step, and schedule a consultation by calling 307-382-5545.

* There is also something called sole custody. This is where one parent has the right to make all decisions regarding the children. The other parent only has visitation rights at the discretion of the sole custodian. Sole custody is very rare. 

By Steve Harton

Additional Resources

Child Support in Wyoming – more information on child support.

Net Income for Child Support – information on calculating net income.

How to Make Sure You Have a Miserable Divorce – What to avoid if you are getting a divorce with children.

Insurance company is not following will

I had a call the other day from a lady complaining about an insurance company. She complained that the insurance company is not following will that her father wrote.

In the will, father left everything he had to his daughters. He also named the caller lady his executor.

Father also had a life insurance policy. Daughter sent in the death certificate, and asked the insurance company to mail her the money. She told the insurance company that she was going to divide the money among the sisters, as the will said.

The insurance company wrote back and said sorry. They will not send her the money. They will be distributing the money according to the beneficiary designation of the policy.

So, this lady was upset because she thought she should get the money, so that she could split it with her sisters.

But there were a couple of problems with this lady’s plan. One should have been expected, but the other one was a surprise.

Life Insurance Policies Pay According to Beneficiary Designations

When a person buys a life insurance policy, the company requires the owner to designate who the money will go to. This is called a beneficiary designation.

People usually designate their spouse, their children, and/or some other relatives. If a beneficiary dies before the owner dies, then the money goes to the other beneficiaries, or to the owner’s estate. Each insurance policy is unique, and this can vary.

Father listed his daughters as beneficiaries of the policy. However, to these sisters’ surprise, he also listed one of his nephews as a beneficiary.

This nephew had lived with them for a while when they were all teenagers, but he hasn’t had much to do with the family since then. That is probably why the father did not leave him anything in his will.

Unfortunately for the sisters, and fortunately for the nephew, father never updated his beneficiary designations. Even though he owned the policy for about forty years.

This is why you should check your beneficiary designations every year, and make changes, if necessary.

Insurance Proceeds Do Not Pass Through Probate

I then explained to the lady that insurance policy proceeds are not part of a probate estate. Therefore, it does not matter what the will says.*

The insurance company will pay out the policy according to the beneficiary designation. The policy holder can name whoever they want as the beneficiary. They can also designate the percentage that each person will receive.

Insurance Policy Proceeds Are Paid Directly to the Beneficiary

Furthermore, the insurance company will cut a check to each beneficiary. The company will send it to them directly, and not to the executor, the person administering the estate. Therefore, the administrator would not be able to distribute the money according to the terms of the will anyway.*

So the end result for this lady and her sisters was that the insurance company cut a check to each sister and to the nephew, and mailed it directly to them.

Planning Tip

If you have a life insurance policy, it is a good idea to check your beneficiary designation periodically. Once a year would be good, when you are going through your annual legal checkup.

* The only exception to this is if there is no beneficiary designated, or if the policy holder designates his estate as the beneficiary. 

How Can We Help?

Here at WYeLawyers, we can help you review your beneficiary designations, and help you with drafting a will, or a trust, if appropriate. So take the next step, and schedule a consultation by calling 307-382-5545.

By Steve Harton