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Child Support – Issues and Answers Transcript
Hello, my name is Poroshad Mahdi, and I will be discussing with you, child support. This may seem like a very simple area, but it is not as simple as one might think. You can make a lot of mistakes when you do it on your own.
Child support is not just about the Child Support Guidelines. Child support also involves many additional expenses, such as daycare costs and when the child gets older, your child is older, university costs. Also, child support can go on for a very, very long time, so you’re best to come up with a good child support order from the very beginning.
I can give you an example of a client of mine, who unfortunately, without consulting a lawyer, reached an agreement for child support. He later came to me after he signed the agreement. He came to me because all of a sudden his ex was chasing him for additional monies. He was on the hook to pay for daycare costs and retroactive child support.
Now this client of mine I was able to help out after the fact by going to court and varying this agreement. Needless to say, it’s a lot more expensive, a lot more stressful, a lot more cumbersome to change a bad agreement or a bad order after the fact. It is best to get it right the first time.
The question I’m always asked by people who have to pay child support, and by people who need to be paid child support is what is the proper amount of child support. Fortunately, we have the Child Support Guidelines which shows exactly what amount of child support must be paid in most circumstances, certainly not all circumstances.
Now the Child Support Guidelines are a chart that can be used to determine the amount of child support for one, two, three, and four children. And this website of ours can make your life a little bit easier. We put in a calculator that you can use to determine the exact amount of child support you should be paying or you should be receiving.
Child support is based on gross income. Gross income is all the money you make each year before the government or anyone else takes money out. Determining a person’s gross income can be very complicated, especially when one person is self-employed. Self-employed people can write off a lot of expenses. Some of these are legitimate; some of these are not legitimate.
So I sometimes see people come to my office and they write off their home office expense. Now a lot of these people don’t really have a home office, but they just tell the government they do some work from home and they write off home office expenses. Now, keep in mind, even though Canada Revenue Agency, the agency that does your taxes, is perfectly fine with these write-offs, family court is not going to be alright with these write-offs.
Also, self-employed people have the benefit of receiving cash a lot of times. Sometimes they disclose the cash; sometimes they don’t disclose the cash. Now the court has a way of tracing this cash.
Another complication in determining gross income is when the person is underemployed. So lots of times I have people come to my office and say my ex, he’s just lazy. He should be working full time, but he’s not. Or my ex, he’s working for his dad, but he’s claiming he’s not getting paid anything. Really, I think he’s getting paid.
Well, the courts have a way of imputing income. So if the court believes that someone is deliberately underemployed or unemployed, a lot of times what they do is they say that’s not your children’s problem. You should be paying child support as if you work because your children should not suffer because you choose not to work.
In that case, the court will impute an income of say $40,000, which is what the payer may have been getting paid before he quit his job, and the court may decide the payer should have to pay child support based on that imputed income.
Not all cases follow normal Child Support Guidelines. The first exception is shared parenting. That’s when both parents have the child live with them for not less than 40 percent of the time. Now, with shared parenting, one can have a reduction of child support, but there is not necessarily a reduction of child support, or perhaps if there is a reduction, a reduction may not be as great as the payer may wish.
Now with shared parenting, the first dilemma is when the 40 percent threshold is passed. This itself is a big kettle of worms. The next question is by how much the child support will be reduced. The idea is both parties have significant expenses related to that child. With shared parenting, both parents need a proper room for the child, both parents would need to buy clothing for the child, and there’s a lot of duplication, for example with snow outfits and sports equipment and so on and so forth.
So the idea is the payer should have a discount because he or she is now paying for all these additional expenses for the child. But then the recipient may not be so appreciative of this discount, because the recipient may respond, I still have the same expenses for my child.
Now, another exception to the norm of following the Child Support Guideline is with a split parenting situation. Now an example of this is when there’s two children, let’s say, a son or a daughter. Let’s say. the daughter lives with mom and the son lives with dad. In such a case we would determine child support by looking at how much child support would mom have to pay dad and how much child support would dad have to pay mom. And the difference would be paid by the higher income parent.
Now, another exception to following the federal Child Support Guidelines is with higher income people. Now, the guidelines themselves say that we may deviate from them when the payer’s income is greater than $150,000. Now realistically, I find that with my client who have $150,000 income or higher, of course. they’re going to stray from the guidelines.
You see some straying from the guidelines when you push the $1 million a year income. But case law is bound with mothers receiving $20,000 a month for one child. So a lot of child support can be paid for one child.
The final exception to the norm of following Child Support Guidelines I am going to deal with is undue hardship. Now, this comes into play when the payer, let’s say dad in this case, has a lot of expenses and it just doesn’t seem fair for him to pay child support according to the guidelines. Or it may also be that the recipient, let’s say mom in this case, has a very high income.
So, for example, if you have mom making $5 million a year, and dad makes $50,000 a year, the bottom line is it’s not fair to force dad to pay child support for two children because mom has a lot more disposable income and she really doesn’t need child support from dad.
We also see undue hardship arguments when dad has a lot of expenses, so for example, if dad has a lot of medical expenses, or a lot of expenses that are not in his control. That can be grounds for undue hardship.
We also see undue hardship when dad has a lot of children, oftentimes with different mothers. I have one client, for example, who has several children with different mothers, and there is an economy of scale with the Child Support Guidelines. So with the Child Support Guidelines, for example, if you have three children one mother, the dad would have to pay less per child than if he has three children with three different mothers.
So if we have a dad, in this case, who’s got many children with different mothers, he would be paying pretty much all of his income in child support. And in that case, he would go to the court and say, “Look, at the end of the day, I have no money for myself, and there’s no way I can pay all of this money for the children.”
Now the Child Support Guidelines and base child is not the entire story when it comes to child support. There’s also Section 7 expenses or special or extraordinary expenses. And these are expenses the payer would have to pay on top of base child support, or usually on top of the amount set out by the guidelines. These can include day care expenses, private school, and university or college expenses.
Now you’re probably wondering for how long will child support be paid. That, like everything else is a bit more complicated. There is no automatic cutoff date. A lot of people assume that child support will not be paid anymore once the child turns 18. That is an error. I’ve seen many cases where child support continues well past the child’s 18th birthday.
So, let’s say, your child goes to university or college, and the child continues full time with his studies. In that case, child support would be paid until your child finishes, at least, his first university or college diploma, or degree.
Child support can even be continued after the child has finished his first degree. There’s many cases out there where the child is has received child support for university studies after an undergraduate degree, so there’s a case out there, for example, where the child is receiving child support for her dental schooling. I had a case myself recently where the father was forced to pay child support for a son to get his PhD. So it’s not all that simple.
Now where a child has a disability or special needs, child support can continue well past the child’s 18th birthday or after the child has completed full-time school. Child support can be paid directly from the payer to the recipient, or it can be collected by the Family Responsibility Office, F-R-O or FRO for short. FRO is a government agency that operates free of charge to the payer and the recipient. It does not charge anything for its services.
FRO has a lot of powers. Firstly, FRO can ruin the payer’s credit if the payer fails to pay child support on time or is arrears of child support. FRO can suspend the payer’s passport. FRO can suspend a payer’s driver’s license, and now FRO can also take away the payer’s vehicle.
The most draconian option available to FRO is that it can take away the payer’s liberty. A payer can be sent to jail if he or she fails to make child support payments.
Well, this sums up our section regarding child support. Thank you for your time. My name is Poroshad Mahdi. If you have any other questions, I would suggest you browse our website and check out the child support calculator and the other information we have about child support. Thank you.