Family Support- What is it?

Family support is a hybrid of child support and maintenance. Under prior tax laws, it allowed the person who is paying the support payments to deduct them from their taxes, assuming all of the previous requirements of sec. IRC 71 and 215 were met, and required the payee-recipient to report the payments as taxable income. Since the change in the tax laws, under the Tax Cuts and Jobs Act of 2018, maintenance and family support payments are no longer deductible to the payer or are taxed as unearned income to the payee-recipient. Therefore, since 2018, family support payments are rarely used any longer.

The statutory provision in Wisconsin for family support payments under the family code is sec. 767.531 and reads as follows:

Wiscoinsin Family Support. 76767.531

Subject to s. 767.511 (6m), a party ordered to pay family support under this section, 2019 stats., shall pay simple interest at the rate of 1 percent per month on any amount in arrears that is equal to or greater than the amount of child support due in one month. Subject to s. 767.511 (6m), if the party no longer has a current obligation to pay child support, interest at the rate of 1 percent per month shall accrue on the total amount of child support in arrears, if any. Interest under this section is in lieu of interest computed under s. 807.01 (4), 814.04 (4), or 815.05 (8) and is paid to the department or its designee under s. 767.57. Except as provided in s. 767.57 (1m), the department or its designee shall apply all payments received for family support ordered under this section, 2019 stats., as follows:

(1) (1)First, to payment of family support due within the calendar month during which the payment is received.

(2) (2)Second, to payment of unpaid family support due before the payment is received.

(3) (3) Third, to payment of interest accruing on unpaid family support.

In the case of Vlies v. Brookman, 2005 WI App 158, 258 Wis. 2d 411, the court had this to say, when trial judges wish to enter a family support order:

“The circuit court must separately calculate child support and maintenance as a condition precedent to calculating family support. If the court applies the percentage guidelines when setting child support, it must set family support at an amount that results in a net payment, after state and federal taxes are paid, of no less than the child support as calculated under the guidelines. Even if a court makes detailed findings as to all of the factors for family support, the court erroneously exercises its discretion if it neglects to provide a rational explanation of how its findings lead to the support award.”

If you have further questions concerning family support payments in the state of Wisconsin, please feel to contact one of our experienced family attorneys at Karp &  Iancu, S.C.

Resources:

https://docs.legis.wisconsin.gov/statutes/statutes/767/vi/511/6m