Child Support

Child support in New Jersey for parties with combined net (after tax) income of less than $187,200 per year ($3,600 per week), are supposed to be determined based upon the Child Support Guidelines.  The Guidelines are based upon economic data of what it costs to raise a child.

indexThat economic data has been reviewed and, as a result, there are proposed changes to the child support guidelines that may actually see the figures going down, especially for multiple children. The Supreme Court has published the proposed changes on the Court’s website.

As noted in the New Jersey Law Journal, the state Supreme Court’s Family Practice Committee is recommending rule revisions that would allow child-support determinations to be based on a broader and more accurate picture of family spending. Specifically, the committee urges adoption of a new award schedule that “for the first time captures spending in families over a twelve year period,” from 2000 through 2011, which “encompasses prosperous years, recession years and the current slow recovery years.”

For sake of reference, at the highest level, the weekly amount of child support to be apportioned between both parents based upon their percentage shares of net income is follows:

No. of Children            1          2          3              4          5          6         

Current                         $453    $606    $658    $733    $806    $877

Proposed                     $571    $589    $731    $803    $884    $973Continue Reading Will New Jersey Child Support Awards Be Going Down?

Very often, we deal with cases where our client or his/her has compensation from employment that is more than just salary plus bonus. Rather, with all of the financial services companies, pharmaceutical companies and other corporations in this area, we see all sorts of different compensation structures, including stock options, restricted stock, RSUs, REUs, etc.  Moreover, when the employee is in management or higher up in the company, the types of deferred compensation and/or equity plans can get even more complex.  Further, by its very nature, deferred compensation is not realized as income immediately, but usually over several years, typically 3 to 5 years.  Often it vests in two ways.  On way is serial vesting – 100 options are granted which vest over 5 years – 20 per year.  Sometime there is cliff vesting which means that the options all vest in year 5.  When an employee has been with a company for several years, then often start to have deferred compensation vesting each year and possibly available for income.

The question often arises as to whether these deferred compensation vehicles are income, assets or both,  While the answer is not simple, it is not as complex as many make it out to be..

Typically, deferred compensation that was granted prior to the date of the Complaint for Divorce is treated as an asset and is subject to equitable distribution.  If the deferred compensation is vested, meaning it can be immediately cashed in, then quite often it is equally divided (though again, New Jersey is an equitable distribution state not an equal division stated so it is not an automatic that these assets will be equally divided – sometimes it just seems that way.)

If the deferred compensation is not vested and requires continued, post-divorce Complaint service in order for vesting to occur, that is where things get more difficult.  I have seen some simplistically argued that anything granted before the Complaint gets equally divided no matter when it vests.  More recently, I have seen a greater use of some type of calculation (coverture fraction) used to recognize the post-complaint service of that spouse.  Many believe this to be the fairer way of equitably dividing deferred compensation.Continue Reading DEFERRED COMPENSATION – INCOME, ASSET OR BOTH?

 In the unpublished (non-precedential) trial court case of Rendon v. Ale, the Court determined that a biological father, who while married to another woman, donated sperm in order for another woman to be artificially inseminated was not insulated under the protections of the Artificial Insemination Statute.

In Rendon, the parties, who were initially both married to other people, started a romantic relationship. After many years of their on again, off again affair, and notwithstanding that Defendant was still married, Defendant agreed to donate his sperm to Plaintiff for the purposes of artificial insemination.  Five days after his first sperm sample was taken, Plaintiff executed and had notarized a “Resignation Letter of Obligations” which stated:

To whom it may concern: This letter confirms the renunciation of all

kinds of paternal obligations that can have Carlos Ale identified with

Social Security # ***-**-3381 with my son or daughter since his (her)

procreation to his (her) adulthood. This includes maintenance, healthcare,

child support or any other responsibility as a father.

Very truly yours, /s Alba Rendon.Continue Reading Sperm Donation: The Gift that Keeps on Giving?