Struggling to Pay Child Support Due to Coronavirus?

Layoffs. Furloughs. Shutdowns. Business closings. Investment losses. Millions of families are feeling the trickle-down economic pain of the coronavirus pandemic, and divorced families are dealing with their own challenges.

What happens when you lose your job or your hours are cut and you have monthly child support and alimony payments to make?

10 Practical Tips to Make Divorce More Tolerable

With a staggering 30 million Americans filing for unemployment by the end of April, family law attorneys are hearing from clients seeking to modify those child and spousal support payments. After all, these payments are calculated on income histories that didn’t take into account this kind of unprecedented event. We saw this in the 2008 recession, too, but the current crisis is the likes of which our country hasn’t seen since the 1930s.

From just $107.88 $24.99 for Kiplinger Personal Finance

Become a smarter, better informed investor. Subscribe from just ~~$107.88~~ $24.99, plus get up to 4 Special Issues

CLICK FOR FREE ISSUE

https://cdn.mos.cms.futurecdn.net/flexiimages/y99mlvgqmn1763972420.png

Sign up for Kiplinger’s Free Newsletters

Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.

Profit and prosper with the best of expert advice - straight to your e-mail.

Whether you are on the paying or receiving end of child or spousal support, here are four tips for navigating this challenging time or any crisis that affects your household income and your ability to pay or receive child support or alimony.

1. Communicate early and often.

As soon as an event — a layoff, a furlough, a pay cut, loss of a big client — occurs that lowers your income and could affect your ability to make your current monthly payment, talk to your ex. You might be able to live off savings for a while, but you want to give a heads up that your situation has changed. Even if your income hasn’t yet been impacted, talk with your ex as soon as you have the feeling it will be. If you’re tightening your belt, your ex might appreciate knowing they should do the same — just in case payments are reduced in the future.

2. Don’t wait to request a modification via court.

Generally speaking, you want to ask for modification to your payments in your state court as soon as possible. Again, you might be able to manage your cashflow for a bit or think you will land a new job or more work soon. But you also might not, and your request will take time to go through court, especially as many courts have been shut down or are operating on modified schedules or will be reopening with significant backlogs. In 2008, it took about a year from the time that clients had a drop in income until they were able to modify their payments in line with their new financial situation. And back then courts, of course, remained open throughout the downturn.

Your support bills will continue to accrue, whether you can pay them or not, so get in line to take it up with a judge. If your situation improves in the meantime, you can always withdraw your modification request.

Raiding Your 401(K) Can Be a Divorce Disaster

3. Try to work it out directly with your ex.

You don’t have to wait for a judge to modify your payments. You can take control of the situation. If you and your spouse are on any sort of decent terms, you can collaborate on what would be a new payment and for how long and under what terms. You will each still want to bring in your attorneys to draw up documents that make it official. But you will each will pay less in attorney fees if you work it out than if you have to get the court involved.

Even if you’re not on great terms, it doesn’t hurt to try to work it out directly. Just keep a record of your attempts to reach out to your ex and if or how your ex responds. If you still end up in court, a judge could look more favorably on the party who at least tried to solve a problem proactively and in a timely manner.

4. Understand your income and your ex’s financial situation.

Just as you did when you were divorcing, you and your attorney will need to make sure to understand your finances and your ex’s. If you are the party who makes support payments, start out by separating your fluctuating income — bonuses, deferred compensation — with your more stable income — like a twice monthly paycheck and interest income. Then come up with best- and worst-case scenarios for your ability to make your payments in full or reduced payments. This will help you make your case to your ex or a judge.

You also want to understand your spouse’s situation and how it may have changed since you split and signed your divorce settlement agreement. Your ex might be able to claim they don’t work, and thus, need 100% of their support check. But perhaps family is helping out or a boyfriend or girlfriend has moved in and is contributing to the household. Knowing these details will help you build your case for what constitutes a fair payment now and until the world returns to normal.

Bottom line: Modifying your alimony and child support obligations won’t be quick or necessarily easy. Work at it as you did your divorce – or wish you had. Communicate proactively. Get ahead of the situation. Collaborate when possible. Loop in your attorneys.

When Couples Divorce, Who Gets Fido? 'Pup Nups' Can Help

Disclaimer

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

TOPICS

Tonya Graser Smith is a Board Certified Specialist in Family Law, licensed North Carolina attorney and founder of GraserSmith, PLLC, in Charlotte, N.C. She focuses her practice on divorce, child custody, child support, alimony, equitable distribution, prenuptial agreements and other family law matters.