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Child Support

If I Pay Child Support, Can I Claim My Children As Dependents On My Taxes?

Wednesday, February 10th, 2016

Divorce touches on every aspect of life, including taxes. So, as Atlanta divorce attorneys, it is not uncommon for clients to seek our advice on divorce related tax concerns. One of the most common questions we get concerns taxes and child support, specifically: “Can I claim my children as dependents on my taxes if I pay child support?” Generally speaking, IRS rules only allow custodial parents to claim the dependency exemption for his or her qualifying children. For income tax purposes, the IRS defines the custodial parent as the parent with whom the child lived for the greater part of the year. So, even if you are paying child support for the child’s benefit, you will likely be unable to claim your children as defendants on your taxes if you are a non-custodial parent.

Although only the custodial parent is entitled to claim the dependency exemption in most cases, a noncustodial parent may be able to claim the exemption if the special rule for children of divorce or separated parents applies. This rule only applies if:

  • One or both parents provided more than half of the child’s total support for the year;
  • One or both parents have custody of the child for more than half of the year; and,
  • The parents are divorced, legally separated, or lived apart at all times during the last six months of the year.

If all the above conditions are met, and the custodial parent signs a “Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent” (IRS Form 8332), or provides a substantially similar statement to the non-custodial parent, the non-custodial parent may claim the dependency exemption for any qualifying child. It is important to remember though, that the Form 8332 or similar statement must be signed by the custodial parent, and the non-custodial parent seeking to claim the exemption must attach the form or statement to his or her tax return.

If you are a non-custodial parent seeking to claim the dependency exemption for your children, or you are currently going through the divorce process and are unsure how to resolve this issue, it is important to discuss your options and the specifics of your case with your divorce attorney and a certified public accountant or certified tax preparer.

Are Child Support Payments Tax Deductible?

Friday, January 22nd, 2016

Many considering divorce, and even some individuals currently going through the divorce process in Georgia, are often surprised to learn that that alimony is tax deductible for the payor and treated as taxable income to the recipient spouse. After learning this information, the next logical question is: “Are child support payments tax deductible too?”

Unfortunately for non-custodial parents ordered to pay child support post-divorce, unlike alimony payments, child support payments are not deductible by the payor. Consequently, child support payments are not treated as taxable income to the custodial parent receiving the child support payments. So, if you are a non-custodial parent ordered to pay child support and alimony to your ex-spouse, be sure to keep track of the payments designated for alimony and the payments designated for child support for tax purposes. If you are a custodial parent receiving child support and alimony payments, it is also important for you to keep track of child support and alimony received separately. As an alimony recipient, you must include the alimony payments received when calculating your gross income for income tax purposes; however, you are not required to include the amount of child support payments received when calculating your gross income. Like with any question regarding income and taxes, be sure to speak with a certified public accountant or certified tax preparer when completing your tax returns.

Is Paying Off Your Child’s Car Considered Child Support?

Tuesday, December 8th, 2015

Imagine that you purchase a car for your sixteen year old child. Later on, unforeseen things happen and you end up divorcing your spouse. If the court orders you to pay off your child’s car as part of the divorce, is that considered child support? The Georgia Court of Appeals recently considered a similar situation.

In Partridge v. Partridge, Mr. and Mrs. Partridge were married on December 30, 1994, and had two children together. Partridge v. Partridge, 297 Ga. 272 (2015). The parties were divorced pursuant to a June 2, 2014, Final Decree, and as part of the Final Decree, “the trial court ordered, among other things, that Husband ‘shall continue to make monthly payments on the minor child’s automobile, which is currently in her possession, until said automobile is paid in full.’” Id. at 272-73. Mr. Partridge contended that the trial court erred by ordering him to pay the car payments on the minor child’s automobile, since “those car payments constituted an improper deviation from the amount of child support that Husband was legally required to pay.” Id. at 274.

Notwithstanding, the Appellate Court asserted that Mr. Partridge’s “characterization of these car payments as ‘child support’ is misplaced.” Id. The Appellate Court noted that “testimony at the final hearing established that this car was purchased during the marriage, and that both Husband and Wife were joint obligors on the indebtedness owed on the car. Accordingly, this marital debt could be properly addressed by the trial court through its equitable division of the parties’ marital property.” Id. at 274 (citing Moore v. Moore, 286 Ga. 505 (2010)). Therefore, the Appellate Court held that there was no abuse of discretion in the trial court’s decision to make Husband responsible for the continued payments on this marital debt as part of an equitable division of the parties’ property. Id. at 274 (citations omitted).

By: Jason W. Karasik, Associate Attorney, Meriwether & Tharp, LLC

Paying Your Child’s Private School Tuition? This May Count as Child Support

Tuesday, November 24th, 2015

This summer, the Georgia Court of Appeals addressed a case involving the payment of a child’s private school tuition in lieu of paying child support directly to the child’s custodial parent. Although it is never advisable for a parents to ignore or unofficially modify a court’s child custody or child support order, the case of Jackson v. Sanders, A15A0127 (Ga. Ct. App. July 16, 2015), seems to suggest that payment of a child’s expenses may count as child support.

In Jackson, the couple divorced in 2001, when their son was less than a year old. As the non-custodial parent, Jackson (father) was ordered to pay Sanders (mother) $1,005 per month as child support for the benefit of their minor child. Jackson paid child support as ordered until 2012, when both parents agreed that instead of paying child support directly to Sanders, Jackson would pay an equivalent amount to N. J.’s new private school for Sanders’s half of the tuition. In Sept. 2012, Jackson filed a motion to modify child custody. In response, Sanders counterclaimed seeking over $14,000 in unpaid child support. Although Jackson responded to Sanders claim by showing he did indeed provide support to his son by making payments toward his private school tuition, the trial court nevertheless found that Jackson owed over $27,000 in unpaid child support.

Jackson appealed the trial court’s decision, and the Court of Appeals ultimately sided with Jackson holding:

The trial court was indeed correct that, “while parties may enter into an agreement concerning modification of child support, the agreement becomes an enforceable agreement only when made the order of the court.” Nevertheless, our Supreme Court has recognized that there are certain equitable exceptions to that general rule. And included among these “equitable exceptions are situations where the mother has consented to the father’s voluntary expenditures as an alternative to his child-support obligation, or where the father has been in substantial compliance with . . . the divorce decree, for example, where he has discontinued child support payments while he had the care and custody of the children and supported them at the mother’s request.

Here, Jackson and Sanders did not modify the amount of Jackson’s child-support obligation as set forth in the 2001 Judgment. Instead, they merely agreed that Jackson would pay an equivalent amount for Sanders’s half of N. J.’s private-school tuition as an alternative to paying her directly. And our Supreme Court has held that such an agreement was valid under nearly identical circumstances. Thus, the trial court erred in ordering Jackson to pay $27,135 in past due child support, and we reverse its judgment in this respect.

Id. (Quotations in original. References omitted).  Thus, when read with prior Georgia cases addressing this issue, Jackson may indeed allow for non-custodial parents to pay children’s expenses, such as private school tuition, in lieu of direct child support payments to a custodial parent. See Nagle v. Epstein, 241 Ga. 612, (1978) (affirming the trial court’s judgment that the husband was not in contempt for failing to pay past-due child support when he testified that the parties agreed that the wife would accept the his payment of their son’s private-school tuition in lieu of an equivalent amount of past-due child support and the wife did not testify otherwise).

What is Promissory Estoppel, and How Can It Impact My Georgia Divorce?

Sunday, November 22nd, 2015

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Promissory estoppel is not a legal concept generally associated with divorce, child support or any other issue of family law. But, if you are considering divorce and you have been serving as a guardian or primary caretaker of a child her in Georgia, this legal principle may be applicable to your case. The Georgia Court of Appeals has addressed the issue of promissory estoppel in child support cases on more than one occasion. But, the case of Mooney v. Mooney, 235 Ga. App. 117 (1998), is especially instruction on when and how promissory estoppel has the potential to impact divorce proceedings.

In Mooney, the wife agreed to become the guardian of her grandchild, but only if her husband promised to help support the child. Husband and wife subsequently divorced. Although the parties both contributed to the child’s support during the marriage, no provision for child support was made during the divorce. Later, wife filed an action seeking child support from her former husband. The trial court initially dismissed wife’s action, ruling that husband could not be compelled to support his grandchild absent some explicit agreement to do so. However, on appeal, the Georgia Court of Appeals concluded that wife should be able to proceed with her action seeking child support on the theory of promissory estoppel. Id.

Although wife failed to succeed on her claim for child support, the Court of Appeals allowed the wife in Mooney to proceed with her action because she was able to put forward at least some evidence that her husband promised to provide support for their grandchild and that she relied on his promise. Ultimately, wife failed to succeed on her claim for child support based on the theory of promissory estoppel, because she was unable to make two additional showings: 1) that husband promised both her and the child that he would assume responsibilities of fatherhood and 2) that husband held himself out as the child’s father. Wright v. Newman, 266 Ga. 519 (1996); O.C.G.A. § 13-3-44.

If you are considering divorce in Georgia, and you are concerned that promissory estoppel may impact your divorce, or if you simply have more questions regarding this topic or any other divorce related topics, please review our other helpful articles and blogs or give us a call to speak with one of our family law professionals.

Child Support not tied to Child Custody

Wednesday, October 21st, 2015

Along with concerns regarding how child support is used by the custodial parent, another reason commonly given by non-custodial parents to explain their non-compliance with child support orders is that they don’t have the custody or visitation rights they desire. Although this is a very common concern, shared by many non-custodial parents, if you are a non-custodial parent ordered to pay child support, you should know that your obligation to pay child support is in no way tied to your visitation or custody rights. Put another way, you may not withhold child support, even if your ex-spouse or co-parent is wrongfully withholding visitation or parenting time. In fact, there are certain circumstances where a non-custodial parent may be ordered to pay child support, even though no accompanying visitation or custodial rights are awarded.

This may seem unfair, but Georgia law regarding child support and child custody is primarily focused on the best interest of the child, not the best interest of the parent. Child support is fundamental to ensure the financial needs of a child are met, regardless of the parents’ custodial arrangement. Even though a non-custodial parent’s obligation to pay child support is not dependent on his or her ability to exercise parenting time or visitation, if you are a non-custodial parent who has been denied visitation of your child, or if you are seeking to win custody of your child or children, contact your Atlanta Divorce Team today at 678-879-9000 to discuss your options.

Can I Request an Accounting of Child Support in Georgia?

Tuesday, October 20th, 2015

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Before directly addressing the answer to the question, it may be beneficial to first discuss what exactly an accounting of child support is, and why a non-custodial parent might desire an accounting of child support.

What is an Accounting of Child Support?

Generally speaking, an accounting of child support requires a custodial parent to account for their expenses and detail how child support money was used. A non-custodial parent may request an accounting of child support by filing a motion with the court. In some states, a non-custodial parent must allege facts showing why an accounting is necessary. In other states, courts have the discretion to require a custodial parent to detail how child support payments are being used at any time.

Why Seek an Accounting of Child Support?

One very common reason given by non-custodial parents to explain their lack of payment or to explain why they are uncomfortable with paying child support to their former spouse is because they do not believe the custodial parent is using the money for the benefit of the child. One way to address this common concern is to request an accounting of child support. With an accounting, the custodial parent must account for how the child’s expenses are being met, thus assuring the non-custodial parent that his or her payments are indeed benefitting the child.

Does Georgia Recognize the Concept of Child Support Accounting?

Some states allow non-custodial parents to seek an accounting of child support, while others do not. Georgia does not recognize the right of a non-custodial parent to seek an accounting of child support. Cohen v. Barris, 137 S.E.2d 469 (Ga. 1964). In Cohen, a father sought an order of the court requiring his ex-wife to provide an accounting of how child support payments were being applied. In his petition, the father alleged that his ex-wife was not using the funds for the benefit of their children. Although the court agreed that the mother is obligated to use child support funds for the benefit of the children, the court dismissed the father’s claim because a claim for an accounting of child support is not authorized by Georgia law. Id. at 470.

Can I Stop a Child Support Income Deduction Order by Quitting my Job?

Monday, October 12th, 2015

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The short answer to the question is: Yes, quitting your job may temporarily stop an income deduction order. But, the key word here is temporarily.

In Georgia, an Income Deduction Order (IDO) is a court order requiring an obligated parent’s employer to take money from that party’s income to satisfy a child support obligation. Once an IDO is entered and takes effect, the non-custodial parent’s employer will send the child support or alimony payments to Georgia’s Family Support Registry, and the Support Registry will send the payments to the recipient spouse. Although Georgia law generally requires IDOs to be entered automatically in all child support cases, many times IDOs are only put into place if a non-custodial parent has indicated an unwillingness to comply with the court’s order to pay child support or a non-custodial parent has failed to pay child support in the past.

In the event an obligated parent in unable to meet their child support obligation due to a substantial change in financial circumstances, such as a job loss, he or she may petition the court for a downward modification of child support. However, if an obligated parent voluntarily quits their job, this will not automatically terminate or reduce the child support obligation. Although as stated above, quitting a job may temporarily stop an income deduction order for child support, this does not stop the child support obligation, and will not stop the accrual of child support arrears. Thus, if you are a non-custodial parent who is currently satisfying your child support obligation via income deduction order, please know that if you quit your current job, the income deduction order will indeed stop. But, once you resume work or obtain another job, another income deduction order will be put into place to collect currently owed child support along with any accrued arrearages.

Is Imputing Income to Non-Custodial Parents Fair?

Saturday, September 26th, 2015

In Georgia, child support is calculated using Georgia’s Child Support Worksheet. This child support worksheet relies on the monthly income of each parent, along with other information regarding the income and expenses of each parent, to determine the appropriate child support obligation for the non-custodial spouse. However, in the event the non-custodial parent is unemployed or underemployed, an income may be imputed to that spouse for the purposes of calculating child support. For example, if a non-custodial parent is unemployed and has no significant work experience, a court may impute an income of minimum wage on that parent. Alternatively, if the earning potential of an unemployed or underemployed parent can be proven by examining that parent’s work history and prior salary, a higher income may be imputed on that parent.

The rationale behind the imputation of income on non-custodial parents is to ensure that child support is calculated fairly and uniformly, and to deter non-custodial parents from quitting their jobs or seeking lower paying jobs to avoid child support obligations. Although the ultimate aim of this policy is to serve the best interests of the child involved, many child support reform advocates argue that calculating child support based on imputed income instead of actual income is unfair to non-custodial parents because jobs are hard to find. Due to the instability of the current job market, child support reform advocates believe that imputing income to unemployed non-custodial parents traps these parents in a cycles where they are obligated to make child support payments that it is impossible for them to pay.

Child support reform advocates are correct that ordering an unemployed parent to make child support payments, regardless of their ability to pay, is not practical. However, child support is not calculated in a vacuum, without regard to the special circumstances each parent faces. In determining a non-custodial parent’s child support obligation, Georgia courts may consider all of the facts and circumstances or each case, and may apply certain deviations and adjustments to the presumptive child support amount generated by the child support worksheet. Thus, the answer to the above question is yes, imputing income to non-custodial parents can be fair so long as family courts use their discretion to consider all the facts of each individual case.

Beware of Child Support Collection Scams

Saturday, August 22nd, 2015

Owed child support? If so, there are several ways to enforce your child support order, including filing a contempt action against the non-custodial parent, seeking an income deduction order or garnishment of the non-custodial parent’s earnings, or contacting your local office of the Georgia Department of Human Services, Child Support Enforcement Division. Additionally, there are some private agencies that offer to collect child support arrearages in exchange for a contingency fee or percentage of the amount collected.

Although divorce and family law attorney are prohibited from entering into contingency fee agreements with clients, when the collection of past due support is treated like a collections case, contingency arrangement may be acceptable. Seeking the services of such a private collections company is an option if you are seeking to collect child support arrearages, but it is not advisable, because such companies may take up to 40% of the child support you are entitled to as payment of their services.

Additionally, as evidenced by the fraud perpetrated by the private company formerly known as the Child Support Services of Georgia, seeking the services of a private company could be potentially dangerous. In that case, the owner of the company pleaded guilty in 2014 to federal charges including conspiracy to commit mail and wire fraud and money laundering after it was discovered that his company stole over $2 million dollars from Georgia parents seeking child support arrears by defrauding them. According to parents who fell victim to this fraud, the company would contact the non-custodial parent and enforce the child support order, but instead of forwarding the money collected on to the custodial parent, the company would instead pocket most of the money, using it to fund the expensive lifestyle of company owners.