The temperatures are starting to drop and holiday cheer is starting to fill the air. As many people complete their Christmas shopping, some might be wondering, “can holiday gifts be counted towards child support?” Child support can be a complicated issue and it is normal for questions to be present. When there is no working agreement between ex-spouses or the individual provides money outside of the court judgment for child support, it is often taken as a gift rather than alternatives to spousal or child support payments. Before assuming the money is a gift, it is important to consider the matter carefully and consult with a lawyer.
Mistakes in a Divorce
There are many mistakes one parent may make when divorcing or when no longer in the marriage when applied to the children from the relationship. If the father or mother provides the youth with money, gifts or other items that should take the place of child support payments, he or she may not receive credit for these items if they are not first cleared with the courts or the parent. An agreement to pay for other items rather than child support is another mistake if there is no prior arrangement or clearly defined plans in place. Insurance coverage, health and well-being or even providing supplies for school and other events are some items the parent may give that could take the place of child support.
Gifts Considered by the Court
It is important to first clear any possible outside payments, items or arrangements with the courts when the parents process the child support and other arrangements through a judge. The courts may consider anything outside of the usual child support payments as a gift no matter who they go to. This could include giving the ex-spouse money or other items. Giving the child toys, a trust or funds outside of the usual arrangements are often considered gifts by the court even if they are meant as part of the child support payments. The courts will not count them with child support if not first cleared through the judge involved in the case.
Payments Outside the Order
Generally, any payment in any form outside of the agreement is a type of gift. The ex-spouse may feel guilty, have an excess of income or want to provide for the child or former spouse after the divorce is complete. In these situations, unless there is an agreement in place or a special consideration, these monies are usually a gift. Any cash or direct deposit of funds to either the custodial parent or child are not necessarily part of the upkeep and basic care or needs of the child. Then, the payments that the individual gives outside of the court order for child support payments are a gift that has no connection to the support payments.
Offers for Other Items
Sometimes, the ex-spouse or child will ask for or explain an additional expense that may require more money than the child support payments provide for with the youth. This could include summer camp, sports and extracurricular. In these situations, it is possible to apply the amounts to the traditional child support payments unless the courts do not recognize these arrangements. In some instances of these extra monies, it is up to the custodial parent to determine how to handle the funds. He or she may contact the court or an agent to give the noncustodial parent credit for the money or keep it and consider it a gift if the courts have no other stipulations.
Alternative Methods
Generally, the couple or ex-spouses will need to arrange and discuss alternative methods of child support other than cash or the specific amount. The mother or father may want to give the youth more or deposit additional amounts in an account or trust for a later use such as college or buying a home after reaching the age of majority. If both parties agree, the parent may provide these additional amounts or make arrangements through the courts or with legal documentation to ensure the gifts give credit to the individual as an alternative method of child support.
The courts may have little to do with additional gifts or when the parent wants to seek alternative ways of caring for the child from the marriage. If the parents are in a friendly relationship past the divorce, extra or different child support is possible with less difficulty.
What does child support cover?
In Utah, child support payments must be used for things related to the living expenses of the child. This includes both basic necessities, like food, shelter, clothing, and medical expenses, as well as general living expenses such as daycare, travel and transportation, and school-related costs.
Are Gifts and Loans Considered Income?
In most situations, gifts are not considered income for the parent who receives them, unless they are provided on a regular basis by the non-custodial parent. Even though the law controls how monetary gifts are taken care of, the final verdict the judge gives are usually based on their regularity and the duration. This includes whether they were part of the income during the marriage, whether the sender can keep providing it, and if it is generated from an investment.
If the gift is deemed an income by the court, it is usually added to child support payments. In this case, you can provide evidence that the payment is irregular and that you cannot guarantee regularity if there is any. In case you have to pay more for child support due to said gifts and cannot generate enough money to cover, the court may modify its order, according to your income change, once you make the request. However, your claim will be investigated to verify balances as well as your employment status.
When it comes to loans, it depends. Net income for child support is defined by statute, meaning it is determined by calculating the income of the supporting parent from all sources and subtracting specific deductions, such as premiums from health insurance and taxes, among others. These deductions can also include expenditures that were made to repay debts for reasonable expenses for income generation or for medical expenses.
In such cases, the court can reduce the net income, keeping the minimum child support amount that is due, and will enter an order for approved modifications once that payment period is completed. In either case, before you claim gifts or loans as income, you should first have an attorney go through them and evaluate your financial health. You may not be eligible for a reduction in child support payments – and if you are, your family attorney can help you come up with a good defense.
The General Rule of Child Support and Gifts
Unfortunately, for the parent who isn’t the custodian, there isn’t a path for holiday gifts to be counted as some sort of credit toward child support. Even if the gifts count as some sort of necessity, it isn’t going to come out of the regular payment plan. For example, if someone owes $100 per month in child support and they spend that much on gifts for their child, they still owe $100 for the month. There isn’t a path for holiday gifts to be counted toward child support payments.
Giving Gifts if the Money is Tight
The holidays can be an expensive time of the year, especially when there are people who are spending hundreds of dollars on Christmas presents. If the money is really tight, it is a good idea to pay the child support payment first. Then, if there isn’t much money left for Christmas, this is a reality of the situation. Remember that failing to make child support payments on time can result in wages being garnished, driver’s licenses being restricted, and other punishments. If there has been a change in income, it is a good idea to speak with a child support attorney. There might be pathways to a child support obligation reduction.
Strategies Surrounding Gift-Giving and Divorce
When divorced individuals are looking to provide gifts for their children, it is a good idea to coordinate for the benefit of the kids. This will reduce the tension and frustration surrounding the holiday season. Some of the strategies include:
• Decide whether the gifts are all going to one house or if they are being split between the two houses
• Decide whether the gifts are going to “Santa” or have individual parent names on them
• Decide whether the gifts are all going to come on the same day or if they will arrive on different days
• Thinking about this ahead of time can make the holiday season run much more smoothly for families who have experienced divorce.
What Income Counts Toward Child Support in Utah?
Child support is one of the most common issues addressed in Utah divorce and child custody cases. It’s really one of the more straightforward aspects of most cases.
Child support is really a function of how many overnights a child spends with each parent every year, and the parents’ gross monthly incomes. As you can guess, gross monthly income is income before you take out taxes. That part’s easy. What’s not so easy is figuring out what money is included and what money is excluded.
Utah Code, Section 78B-12-203(1) says gross monthly includes
• prospective income from any source, including earned and nonearned income sources which may include salaries, wages, commissions, royalties, bonuses, rents, gifts from anyone, prizes, dividends, severance pay, pensions, interest, trust income, alimony from previous marriages, annuities, capital gains, Social Security benefits, workers’ compensation benefits, unemployment compensation, income replacement disability insurance benefits, and payments from ‘non means-tested’ government programs.
Essentially, any income from any source will count toward child support. Now, most of the time people don’t have royalties coming in, and they don’t have five properties paying them rent, or trust income from a rich deceased uncle. (If you do have these income sources, however, keep in mind they will be included in a child support calculation.) No, most people have jobs and earn all their money from those jobs. For normal job-workers, income that can be counted toward child support is limited to the equivalent of one full-time 40-hour job. If and only if during the time prior to the original support order, the parent normally and consistently worked more than 40 hours at the parent’s job, the court may consider this extra time as a pattern in calculating the parent’s ability to provide child support.
So, one 40-our per week job is really the max. If you worked consistent overtime before the case began, the average overtime pay will be included. Likewise, if you received regular bonuses are part of your pay, those will probably be included as well. If you are self-employed or own your own business, gross monthly income is calculated by “subtracting necessary expenses required for self-employment or business operation from gross receipts. Only those expenses necessary to allow the business to operate at a reasonable level may be deducted from gross receipts.”
Keep in mind, necessary expenses are different than tax deductions. For example, you can take a tax break on depreciation on your work car, thereby lowering your taxable income. However, depreciation is not necessary to keep most businesses operating at a reasonable level, so it will likely not be a deduction when calculating child support.
Gross monthly income can also include imputed income — i.e., income someone should earn but doesn’t. Imputed income is most common when someone is capable of working a full-time job, but chooses not to. What it comes down to is you can’t screw your child out of money by choosing not to work. When you do that, you’re essentially stealing for your child, so the court will impute a wage and use that imputed wage to calculate child support. Yes, I know, I said child support was straightforward. Well, it’s pretty straightforward for the law. Honestly, how most child support calculations work is you take each parents’ gross monthly wage from their one job, plug it in the Utah child support calculator, and it provides the child support obligation for each parent.
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It’s not a matter of if, it’s a matter of when. Legal problems come to everyone. Whether it’s your son who gets in a car wreck, your uncle who loses his job and needs to file for bankruptcy, your sister’s brother who’s getting divorced, or a grandparent that passes away without a will -all of us have legal issues and questions that arise. So when you have a law question, call Ascent Law for your free consultation (801) 676-5506. We want to help you!
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