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Posts tagged "support"

Earning Capacity

In a support matter, the incomes of the parties will be used to calculate an appropriate award based on the support guidelines applicable throughout the Commonwealth. At the initial appearance for a support matter, both parties are asked to bring in proof of their income in the form of W-2s, tax returns, pay stubs, or other documentation of income received. If a party is unemployed or underemployed, the rules specify that an earning capacity may be imputed. Pennsylvania Rule of Civil Procedure 1910.16-2(d)(4) explains the first step is a finding that a party willfully failed to obtain or maintain appropriate employment. Involuntary reductions in income (e.g. lay-offs or unemployment due to illness or disability) generally do not trigger earning capacity arguments.

PASCDU

If you are paying or receiving support in Pennsylvania you are likely dealing with PASCDU. The acronym stands for the Pennsylvania Statewide Collection and Disbursement Unit. They are responsible for collecting support from the payors and giving support to the payees. Payors are warned at the time an award is established that they will not receive credit for direct payments to the payee and all payments must go through PASCDU. Payors should receive information on sending payments to PASCDU at their support conference or hearing. Local domestic relations offices may be able to accept payments as well. Wage garnishment is the preferred method of collection for support. Once it is set up, payors do not need to worry about sending payments in any longer as the support due will be automatically withheld from their pay.

Mortgage Payments

A jointly owned property is frequently addressed in family law actions. It may be defined as a marital asset hence subjecting it to equitable distribution. Financial responsibility for the property may also be a factor in the context of a support action. If only one party is making payments on a marital residence while a divorce is pending, they may be able to seek a credit for payments made. This may be the case if both parties are residing in the home or if the party not contributing to the mortgage is residing in the home. Mortgage payments may also be considered in the course of establishing a support award. Pennsylvania Rule of Civil Procedure 1910.16-6 covers adjustment to basic support awards and allocation of additional expenses. Under sub-section (e) mortgage payments, real estate taxes, and homeowners' insurance may need to be considered. Second mortgages, home equity loans and other obligations secured by the marital residence may be considered but are within the discretion of the court and addressed on a case-by-case basis.

Treatment of Veterans' Benefits

Former military members may be eligible to receive a number of different veterans benefits from the Department of Veterans Affairs (VA). Possible benefits include disability compensation, pension benefits, life insurance, educational benefits and more. Veterans benefits cannot be divided as an asset in a divorce case. This is due to the Uniformed Services Former Spouses' Protection Act (USFSPA). The Pennsylvania Divorce Code confirms this rule. Under 23 Pa. Section 3501(a), discussing the definitions for marital benefits, veterans' benefits exempt from attachment, levy or seizure are defined as non-marital. Additionally, the veteran gets to decide how to use educational benefits and who to designate as beneficiary for their life insurance.

Alimony

Alimony is support paid to an ex-spouse following the divorce decree. The amount of alimony is based on the incomes of the parties but may also be affected by the distribution of other marital assets, if any. The length of alimony is directly attributable to the length of the marriage. For example, a party may expect approximately 1 year of alimony for every 3 years married. For marriages of over 25 years, an indefinite term of alimony may be appropriate. Unless otherwise stated by agreement, alimony may be subsequently modified due the changed circumstances of either party. The changes must be substantial and of a continuing nature. Parties to a private agreement may stipulate that alimony is non-modifiable in amount, duration, or both.

APL

Alimony Pendente Lite, or APL, is spousal support while the divorce is pending. A party may petition for APL at the same time as the divorce complaint or any time thereafter prior to the entry of a final decree. The purpose of APL is to ensure each party has the ability to sustain themselves during the divorce. A party seeking APL should be ready to prove they lack sufficient property to provide for their reasonable means and are financially unable of self-support during the pendency of the divorce litigation. It is the income-dependent spouse who would have the opportunity to receive APL. The court may consider the duration of the marriage in making any award. This is to ensure one party does not benefit from a significant support award in the context of a very short marriage.

Filing for Support

23 Pa C.S. Section 4321 provides that married persons are liable for the support of their spouse according to their respective abilities to provide and parents are liable for the support of their unemancipated children under 18 years of age. Domestic Relations is the branch of the court that handles support applications. An application for support can be filed with their office in the county where you reside or where the payor resides. An application can also be initiated online through the support program website. Support between spouses is based on the difference in income. 40% of the difference in income can be awarded in a case where there are no children. 30% of the difference in income is appropriate where there is also a child support component. Child support in Pennsylvania is based on statewide guidelines established by the Pennsylvania Supreme Court. The guidelines are based on an "Income Shares Model" such that the guideline amount is shared by the parties based on percentage of custody time as well as percentage of income.

Unreimbursed Medical Expenses

You may be able to get reimbursed for medical expenses if you have an existing support order. Unreimbursed medical expenses may be allocated between the parties in a support matter in proportion to their income under Pa. R.C.P. 1910.16-6. The court may include the expenses within the support order or direct that it is paid directly to the party receiving support or their healthcare provider. The first $250 per year is the responsibility of the party incurring the expense. This $250 threshold is per person for orders that cover multiple persons. The parties will only need to share expenses that exceed $250 per year per person. Proof of the unreimbursed expenses should be timely supplied to the other party but must be supplied to the other party and Domestic Relations no later than March 31st of the following year. Parties are certainly encouraged to work things out amongst themselves prior to this deadline.

Physician Verification Form

Each party's income is relevant in the context of a support action. Pennsylvania can assign an earning capacity for parties who are voluntarily unemployed or underemployed. There are recognized exceptions to avoid having income imputed if you do not work. One of those exceptions is if you are physically incapable of working. In the event that a party in a support matter asserts an inability to work due to medical issues, the support rules require that a physician verification form be completed. Pursuant to Pennsylvania Rule of Civil Procedure (Pa. R.C.P.) 1910.29 (b), the physician verification form should be completed by the party's physician and submitted at the time of the support conference. A sample of the actual form to be used is contained in Pa.R.C.P. 1910.29(b)(3).

Discovering Assets and Income in Divorce

It is not uncommon for parties contemplating divorce to try to hide assets in an attempt to keep them out of the marital estate that will be up for distribution. One of the biggest red flags as far as potential hidden assets is if the spending habits or lifestyle of a party is way more than would be expected based on their reported income. You should also be wary of a party who owns their own business. If they deal in cash they can easily hide money. Additionally, what they report for tax purposes is not always indicative of income available for spousal or child support. It complex cases it may become necessary to hire an expert to analyze income flow. Top level executives may receive different forms of income. Examples include stock options, bonuses, car allowances, and deferred compensation plans. Even military members often have a compensation package that goes beyond their base salary.

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