Child Support Payroll Garnishment

When a child support obligor is under a weekly, or biweekly, payroll attachment for child support, he may not know that for eight (8) months out of the year, he is in arrears. This can result in an unexpected attachment to a Tax Return, with up to 20% in Interest Penalties. Or worse, after years of paying, and the children are aging out from getting child support, you suddenly learn you are tens of thousands of dollars in arrears, with more than a decade to go in continuing payments.

The problem that arises is both in the way employers are calculating payroll attachments, and how the computers at the State Child Support Enforcement Agency are registering each received payment.

Employers want to take the attachment, and send a check right away, so they take what is ordered for each month, and determine the total for the year. From that total, they divide it by 52 or 26, depending on their payroll setup. As an example, we will use a support payment amount of $500 per month, for a yearly total of $6000.

There are an average of four and a quarter weeks per month. This means that for eight months a person gets four weekly, or two biweekly, paychecks, but for the other four months, there are five weekly, or three biweekly paychecks.

The employer is deducting $115.39 from a weekly paycheck, or $230.78 from a biweekly paycheck, and mailing each amount in. This means that a total of $461.56 a month is sent in for 8 months of the year, while the other four months, the payments total $576.95 per month due to the extra paycheck in those months.

Unfortunately, the state computers processing the payments see them as totaling $461.56 for a month as an underpayment, of $38.44. However, rather than a balancing of the accounts for the year when receiving the $576.95, those are treated as an overpayment or gift of $76.95 to the other parent.

At the end of the year, this leaves a balance owing of $307.52, which then triggers an interest penalty. That interest penalty can run from 3% to 20%, depending on the state.

Using Wisconsin as an example with an 8.2% penalty, there can be an attachment to a tax return of $332.73. However, consider if the state simply accumulates the amount over the period of the child support order.

For Wisconsin, over a ten year period, the total owed would be $3075., with an interest penalty of $2,745, for a grand total owing of $5,820. Nearly another year of child support payments.

For a man paying as a result of a one-night-stand, over an 18 year time period, and not accounting for adjustments, the accumulated amount owed would be $5,535, with an interest penalty of $8,927, for a grand total of $14,462 still owed more than one more year in payments, which will still be collecting even more interest.

Add to this the fact that with four months per year there was an overpayment of $76.95, by the time the $14,462 is paid off, there would be a total overpayment exceeding $20,000, equally nearly three additional years of child support.

For a child support obligor ordered to pay $1000 a month, including interest, the final balance owing would be over $36,000. (Child Support Arrears Calculator)

Employers do not look favorably on making payroll attachments of varying amounts, as it can create an accounting nightmare. As such, a method must be determined to address this issue. The simplest would be an adjustment to the programming of the computers processing the child support payments. However, in this economy, the states will not be willing to pay for a programming change.

That leaves two options:

• Have your employer deduct 25% of the payment from each weekly paycheck, or 50% of the payment from each biweekly paycheck. This would result in a 10% yearly overpayment, but that can be addressed whenever there is a motion to modify the payment, whether up or down. Note that every three years, there is an automatic review of the case by the state that is required by federal law.
• A second option would be to request an employer to deduct a full child support payment out of one payroll check per month, though that may not be possible if the payment exceeds the amount of one check.

In the long term, it should be demanded that Child Support Enforcement Correct this problem in the software that processes payments.

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