Child support miscalculation, abatement, and EIC: BRAUSCH v. BRAUSCH (COA 9/12/2008)

FAMILY LAW: Child support miscalculation, abatement,  and EIC
Published: Affirming
Panel:  Thompson presiding; Vanmeter, Henry concur
Kenton County
Date Rendered: 9/25/2008

Dad appealed from TC’s order awarding child support (“CS”) to Mom, arguing that TC miscalculated CS owed; TC erroneously refused to abate CS during his summer parenting time; and TC should have included the earned income tax credit (EIC) and additional child tax credit received by Mom in its CS calculation.

In 2005, Mom and Dad entered agreed order modifying Dad’s CS obligation while he was attending nursing school. Pursuant to that agreement, CS was to be recalculated effective July 1, 2006 after his graduation. The hearing did not occur until July 2007, when Dad had been employed as a nurse for one year. TC considered James’ year-to-date income from June 30, 2006 through December 31, 2006 in its calculation. Dad contends that TC should have calculated his CS obligation on the income earned for the entire year of 2006, the first half of which he was still enrolled in nursing school and not earning as highly as in the later part of the year.
CA noted that CS statute creates a presumption that future income will be on a par with worker’s most recent experience Furthermore, CA held that including Dad’s income prior to the time of graduation would not correctly reflect his earning capacity for the purpose of calculating CS.

Because Mom must maintain the home and incur continued expenses for the benefit of the children even in the children’s brief absence from the home during Dad’s summer parenting time, CA found no abuse of discretion in TC’s refusal to abate Dad’s CS during that time.

Although Mom received funds from Earned Income Credit and additional tax credit, these amounts were not included in her income in CS calculation. Mom claimed that these funds should not have been included, as CS statute provides that benefits received from means-tested public assistance programs are excluded from gross income for CS calculation purposes. CA found that EIC is a public assistance program, as its purpose is to supplement the income of the neediest of families. It is also “means tested” as eligibility is directly dependent on the basis of income or resources. The additional child tax credit does not fall into the same category because the threshold income is $110,000, thus it does not provide assistance to needy families. Therefore, the additional child tax credit is not specifically excluded from gross income. CA found, however, that it was not income but a federal tax benefit included within the dependency exemption, as the benefit is contingent upon, and in addition to, the dependency exemption. CA noted that result could have inequitable consequences, but until such time as Legislature recognizes treatment of EIC in CS guidelines, such a result is mandated by statute.

Digested by Michelle Eisenmenger
, Diana L. Skaggs +

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