Child Support and Unemployment or Loss of Income

child-support-guidelinesThe Dow Jones Industrial Average is at an all-time high as of this writing. Even if you’re reading this blog post months from when it was originally published, the market is likely far above where it was when the financial markets collapsed in 2008. Yet for all of Wall Street’s flowing champagne and expensive caviar, most people have yet to fully recover and many of my clients are still experiencing financial hardships. The reason I tell you this is to let you know that you’re not alone.

Most of my divorce clients are good people who went through a tough time and are doing everything they can to get their lives on track and keep their obligations to their ex-spouse and children. And whether they have full custody, joint custody or just visitation, there are financial obligations that came with their divorce decrees that must be honored. Inevitably, over the past couple of years, many of my clients have come under further stress due to a change in their financial circumstances.

When a person’s financial condition takes a turn for the worse and he or she is obligated to pay child support every month, it causes great strain on everyone involved. (For questions related to determining child support, visit this earlier article.) This can be resolved one of several ways.

First off, remember that two parties that are communicating clearly and amicably can address this without involving the court. For example, if a man is obligated to pay child support every month and he loses his job, he and his ex-wife can negotiate a lower monthly payment until he regains employment. It’s always wise to have this agreement committed to writing, but it can be negotiated without involving the courts nonetheless.

Using the same example, however, if the two parties are unable to come to a mutual agreement, he can petition the court for a modification of the original order. But know this–just because you lose your job doesn’t mean the court will automatically grant you lower payments. In fact, the court will use all practical measures, such as garnishing unemployment payments to maintain your order when practical. To obtain a modification, a support payer would have to demonstrate that his/her earnings have changed significantly and beyond that persons control and that he or she has actively done everything possible to replace the lost income (job searches must be proven with diaries, copies of cover letters, applications, resumes, and responses, etc.). Even then the courts might not modify the original order.

There’s a flip side to the earnings coin, by the way. If an ex-spouse’s income increases dramatically the custodial spouse can petition the courts for a greater monthly sum (except for most stipulations that resolved support and survived the judgment prior to October 2010, or those that opted out of the new law after October 2010, or when the support was set but the court after a hearing). In our first example, the custodial parent would be wise to understand this before playing hardball during the down times.  And with the economic downfall that gave rise to the first example, many custodial parents have sought to upward modify support due to lost income and increased cost of living.  Sadly, only the lawyers and courts have increased money flow because of this, not the litigants.

No matter the circumstance, much of my counsel is the same as other post-divorce modifications. Act quickly (modifications are not retroactive prior to the date you file); be clear and open about what the problems are and what you’re seeking; document and prove all elements required to gain the outcome you seek; and keep a professional, respectful, courteous  and open dialogue with your ex-spouse and any attorneys that are involved.