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Impact of American Rescue Act on Child Support

The American rescue act affected three credits in dramatic way, especially for lower income households. Click here for our blog post about these credits. These credits dramatically increase after-tax income, especially for lower-income households, but they are effective only for the year 2021. How does this affect child support? The impact on child support occurs […]

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American Rescue Plan

As you may know, Congress passed a stimulus bill in March, 2021, officially called the American Rescue Plan. The bill has many provisions, but three tax provisions in particular will affect the calculations in Family Law Software, especially for the 2021 tax year, with significant impact on cash flow, taxes, and child support. This will […]

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Which Year’s Numbers Should I use?

People ask which year’s numbers they should use for guidelines and budgets: last year’s? This year’s? Next year’s? The year you use depends on the purpose for which you are using the results. Guidelines. For child and spousal support guidelines, people tend to use current year numbers. However, since the guideline payment amount tends to […]

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Accurate Net Income

In marriage dissolution cases, the alimony and child support you calculate depend on the parties’ net incomes. “Net income” Seems like a simple concept. But sometimes it is not so simple to figure out the amount of money that is actually available to spend. Often during divorce, the client who will be required to pay […]

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Equal Parenting in Colorado

Many state child support statutes are fuzzy when parents have exactly equal parenting arrangements. Let’s consider Colorado, for one example. In Colorado, the question is whether we should calculate exactly equal parenting as “shared” or as “split” custody. Under the statute, “shared” physical care means that each parent keeps the children overnight for more than […]

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The CARES Act and Other Legislative Responses to the COVID19 Pandemic

As the global pandemic began to impact the U.S. economy, Congress passed sweeping legislation in an attempt to deal with the anticipated fallout. First, Congress passed the Families First Coronavirus Response Act (FFCRA). Shortly thereafter Congress passed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Between the two acts there are provisions that […]

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Pension – How long should I say the employee will work?

Let’s look at the hypothetical case of a state trooper who has been working 10 years. His accrued pension benefit is $2,500 a month. If he works another 10 years, his accrued pension benefit will be $4,500 a month. He is 52 years old and seems likely to work until regular retirement at age 62. […]

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Lump Sum Alimony and Child Support

In some states, including California, Colorado, Florida, Illinois, Massachusetts, Minnesota, New Jersey, New York, and Pennsylvania, current alimony is a factor in calculating child support. What if the party is paying the negotiated monthly alimony in a lump sum instead of monthly? How should child support reflect that fact? One approach would be to calculate […]

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Non-taxable Disability Income

A client receives income from a private disability policy that is not subject to income tax. Where do we enter this amount and show it is not taxable? Go to Client Info > Income & Expenses > Wage-Like Income. Scroll down to the line for disability income Check the box next to the entry for […]

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Imputed Income

If judge says, “Impute $25,000 of income,” how should I treat that income for tax purposes — as pre-tax or after-tax? Ultimately, it comes down to the imputation of income – was it intended to be gross or net? While it is true the party with imputed income will not be paying taxes on that […]