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Voluntary Reduction of Income and Child Support by Alexander R. Rhoads
Voluntary Reduction in Income Not Basis for Deviation from Guidelines by Alexander R. Rhoads
Revisions to Child Support Guidelines by Alexander R. Rhoads
How is child support calculated? by Alexander R. Rhoads

Voluntary Reduction of Income and Child Support

The Iowa Supreme Court's opinion in the case of In re Marriage of McKenzie addresses the issue of determining child support when the payor's reduction is voluntary but not for the purpose of avoiding or reducing child support. In this case, the non-custodial parent relocated from Iowa to another state and was unable to find employment at a level comparable to that paid by his Iowa employer of 22 years. Finding that the relocating parent "was not free to plan his future without regard to his obligation to his former wife and chid," the court concluded that "substantial injustice" would result if the payor's actual earnings were used and thus established support based upon his higher earning capacity as evidenced by his prior income. As the court summarized, the non-custodial parent's "desire for self-fulfillment is outweighed by the pre-existing duty he had to his former spouse to provide adequate support for his minor child." The court also noted that if actual incomes were used instead of earning capacity, "we would be requiring [the custodial parent] to increase her contribution for the support of the child. [The custodial parent] should not be forced to make up [the non-custodial parent's] reduced child support so that [he] can start a new life with his new wife."

For another case addressing the "self-inflicted/voluntary" income reduction issue, see In re Marriage of Duggan, 659 N.W.2d 556, 562 (Iowa 2003).

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Voluntary Reduction in Income Not Basis for Deviation from Guidelines

The decision of In re Marriage of Opat illustrates the rule that not every voluntary reduction in income is grounds for deviation from the child support guidelines. In this case, the Iowa Court of Appeals affirmed the trial court's finding that a reduction in income from $58,000 with full benefits, including family health insurance at nominal cost, to $45,000 with no health insurance, was not done with the intent of reducing the payor's child support obligation. The evidence indicated that the parent/employee, a high-voltage lineman, was suffering significant distress because of the dissolution and that this caused him and his supervisor to have safety concerns given the nature of his occupation.

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Revisions to Child Support Guidelines

The Iowa Supreme Court has issued amended Child Support Guidelines effective November 1, 2004. The amendments and the review committee's report are available on the Iowa Supreme Court's website.

The most significant changes are:

  • An increase in the upper income amounts encompassed by the Guidelines to $10,000/month for each parent, up from $6,000/month.
  • A 10% reduction to each of the Extraordinary Visitation credits, thereby reducing the reductions to 15%-20%-25% respectively.
  • Addition of express provisions requiring the use of the "offset" method when calculating child support for joint and split/divided physical care cases.
The changes are significant and would appear in many cases to translate into significant changes in the amount of child support that could be owed. Under Iowa law, a modification of support may be warranted when the amount of support owed under the new guidelines differs upwards or downwards by at least 10% from the amount currently ordered.

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How is child support calculated?

The amount of child support to be paid or received by an Iowa parent is calculated according to the Iowa Child Support Guidelines. The Guidelines apply to every case in which support is due. The starting point is determining each parent's gross monthly income. From this amount, a number of deductions and credits are factored in, resulting in each parent's net monthly income. It is important to remember that "net income" for child support purposes is not the same as "net income" for tax purposes. The non-custodial parent's net income is then compared with the custodial parent's net income and a resulting percentage determined. This percentage is then applied to the non-custodial parent's net monthly income to determine the dollar amount of support to be paid.

Calculation of the precise amount of child support in any given case should be made by an attorney who is familiar with the guidelines, interpretation of the Guidelines under Iowa case law, and, most importantly, the facts of your particular case.

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Alexander R. Rhoads
Babich, Goldman, Cashatt & Renzo, P.C.
100 Court Avenue #403
Des Moines, IA 50309
T: 515.244.4300
F: 515.244.2650

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