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Child Support

Any person or agency having custody of a child may file for support of a child. A minor child that has a guardian may have their guardian institute a child support claim on the child’s behalf. There is a presumption that the biological mother and father will be primarily responsible for the support of the minor child. Additionally, parents of a minor that has their own child while under the age of 18 are legally responsible for BOTH their child and their grandchild’s child support until their child reaches maturity.

When one parent is voluntarily underemployed or depressing their income in bad faith, the court can impute (or create an imaginary amount) of income to use to set child support. The North Carolina General Legislature has established guidelines and worksheets so that everyone can determine their child support obligation with some basic information.

The primary information you need is as follows:

The gross income from all sources for both parents.
The total amount of work related (or school related) daycare expenses for the minor children.
The cost of the medical insurance premium for each child.
Any extraordinary expenses.
The total amount of overnights the minor child spends with each parent.

Once you have this information you can create a worksheet. Worksheets are supposed to meet the reasonable needs of the minor child(ren) based on the children’s standard of living.

It is imperative that parents agree on who will claim the minor child for tax purposes, in what ratio or amount each parent will contribute to medical expenses, and any other child related expenses which the parties may incur. Note that a parent does not have an obligation to pay for college expenses unless they agree in writing to assume such an obligation, which we rarely recommend.

Once child support is established and being paid by an order, it should also be paid to the payee and withdrawn from the payor’s paychecks through wage withholding. Direct deposit can also be used by the parties if they do not want the government involved in their child support obligations.

Alimony and Post Separation Support )Spousal Support)

Alimony is payment for the support and maintenance of one spouse from the other. Alimony is paid by a supporting spouse to a dependent spouse. Alimony can be paid in incremental payments, a lump sum, or by paying for some expenses for the spouse.

Post Separation Support is temporary support or alimony that is paid by one spouse pending an alimony hearing. You will generally only find post separation support in court.

One of the benefits of alimony is that it is tax deductible for the party paying alimony (or post separation support) for so long as the alimony is paid pursuant to a written agreement or court order. Additionally, alimony recapture and alimony which terminates around a child related event (like reaching age 18 or graduating from high school) may have different tax deductibility and for this reason you should work with an attorney to ensure the alimony you are asking for/agreeing to pay is going to be tax deductible.

Determining the amount and duration of alimony is really the big question. For our office, clients fill out a financial affidavit which helps us to determine their monthly budget and needs, as well as their disposable income.

Marital misconduct is a factor for alimony. If you or your spouse have committed any of the following acts which are considered as marital misconduct by the court, then the alimony may be dramatically impacted, decreased, increased, or unavailable:

Illicit sexual behavior
1. Acts of sexual or deviate sexual intercourse
2. Deviate sexual acts, or
3. Rape
4. Voluntarily engaged in by a spouse with someone other than their wife or husband
Involuntary separation of the spouses due to a criminal act committed before the alimony action proceeded
Abandonment
Malicious turning out-of-doors (kicking someone out)
Cruel or barbarous treatment endangering the life of the other
Indignities that render the condition of the other spouse intolerable and their life burdensome
Reckless spending of either spouses’ income
1. Destruction of assets
2. Waste of assets
3. Diversion of assets
4. Concealment of assets
Excessive use of alcohol or drugs that makes the spouses’ life burdensome and condition intolerable.
Willful failure to produce necessary subsistence according to the ability of each spouse that renders the condition intolerable and life burdensome

Once you have this information you can create a worksheet. Worksheets are supposed to meet the reasonable needs of the minor child(ren) based on the children’s standard of living.

Equitable Distribution

North Carolina is not a community property state, but instead our law allows for equitable distribution. The court must make a number of determinations in an equitable distribution case. The court must determine what is marital property and what is separate property. There is also a third kind of property in North Carolina, which is distributive property.

An equal (50/50) division of marital property is presumed to be equitable and fair. However, most people ask for an unequal division of property. In North Carolina, you can ask for an unequal division of marital assets. There are a number of factors which the court must consider if someone asks for an unequal distribution, which are:

The income, property, and liabilities of each party at the time the division of property is to become effective.
Any obligation for support arising out of a prior marriage.
The duration of the marriage and the age and physical and mental health of both parties.
The need of a parent with custody of a child or children of the marriage to occupy or own the marital residence and to use or own its household effects.
The expectation of pension, retirement, or other deferred compensation rights that are not marital property.
Any equitable claim to, interest in, or direct or indirect contribution made to the acquisition of such marital property by the party not having title, including joint efforts or expenditures and contributions and services, or lack thereof, as a spouse, parent, wage earner or homemaker.
Any direct or indirect contribution made by one spouse to help educate or develop the career potential of the other spouse.
Any direct contribution to an increase in value of separate property which occurs during the course of the marriage.
The liquid or nonliquid character of all marital property and divisible property.
The difficulty of evaluating any component asset or any interest in a business, corporation or profession, and the economic desirability of retaining such asset or interest, intact and free from any claim or interference by the other party.
The tax consequences to each party, including those federal and State tax consequences that would have been incurred if the marital and divisible property had been sold or liquidated on the date of valuation. The trial court may, however, in its discretion, consider whether or when such tax consequences are reasonably likely to occur in determining the equitable value deemed appropriate for this factor.
1. Acts of either party to maintain, preserve, develop, or expand; or to waste, neglect, devalue or convert the marital property or divisible property, or both, during the period after separation of the parties and before the time of distribution.
2. In the event of the death of either party prior to the entry of any order for the distribution of property made pursuant to this subsection:
1. Property passing to the surviving spouse by will or through intestacy due to the death of a spouse.
2. Property held as tenants by the entirety or as joint tenants with rights of survivorship passing to the surviving spouse due to the death of a spouse.
3. Property passing to the surviving spouse from life insurance, individual retirement accounts, pension or profit-sharing plans, any private or governmental retirement plan or annuity of which the decedent controlled the designation of beneficiary (excluding any benefits under the federal social security system), or any other retirement accounts or contracts, due to the death of a spouse.
4. The surviving spouse’s right to claim an “elective share” pursuant to G.S. 30-3.1 through G.S. 30-33, unless otherwise waived.
Any other factor which the court finds to be just and proper.

The most expensive part of an equitable distribution case seems to be the requirement to place values on every item of property. Real estate and businesses appraisals tend to be rather expensive, especially if the appraiser needs to testify, which they generally do. Also, there may be a need to trace assets in banking accounts to determine if the funds are marital, separate, or divisible and this generally requires a forensic accountant.

Client Questions

I cheated, but it was only one time and my spouse doesn’t know. Can I still get alimony?

Answer:

If you cheated and your spouse does not know, then they may negotiate with you for alimony. However, cheating is marital misconduct that bars or in other words completely negates your ability to get alimony or if you pay, cheating locks in your obligation to pay alimony. Of course this is a slightly “over simplified” explanation and there are a lot of different factors that go into a total alimony analysis. For example, how long ago did the cheating occur? What evidence do you have? Post Separation Support may or may not be affected by cheating, and you should consult your attorney about this.

I contributed to a 401k during my marriage that I had with my employer even before i married my spouse and i do not believe my spouse is entitled to any. Do i have to provide my spouse with half?

Answer:

Some portion of the 401k appears to be your separate property. This is the tricky part – so listen up. In court you would have to trace all the assets from the date of marriage through the date of trial. This generally means that you have to produce all of the monthly statements or hire a forensic accountant. However, there is also a coverture fraction which most people can agree (without going to court) to use and this helps to determine the exact percentage of your 401k which is marital. Your spouse would be entitled to one-half of the marital portion.

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