Situation: Married 22 years, I moved out two months ago at my wife’s insistence, have a letter from her saying no abandonment, etc, but no contact as yet with court. We both work, total gross of about $160k, with a current monthly income differential of $4500 in my favor. Two kids, oldest a freshman in college, youngest a sophomore in high school. My wife has an important exam next month that if she passes will improve her current and future income. So we agreed to wait until January to negotiate final terms of divorce. Meanwhile I am paying all fixed costs and taxes except utilities at house, as well as oldest child’s college costs. I believe she will want to stay in house (we are both on deed/mortgage) until youngest finishes high school, then we jointly sell it. So in looking at this my goal is to pay generous CS while youngest still a minor by setting up our Agreement to where I pay the $1300 mortgage/insurance/tax bill until emancipation, and cover the costs of tuition/room/board/books at NC system rates for both kids. But no alimony. Questions: 1. please confirm it is completely true that a NC judge cannot compel me to pay college costs. 2. Does the fact that I have paid these costs during separation change anything? 3. Assuming #1 is true, do you know of any pending possible change to the law? 4. I believe that if worded properly I can pay the mortgage and get the deductions, even though CS not generally deductible. Correct?
Thanks in advance.
A judge cannot order that you pay college expenses so long as you have not contracted to do so. Since children are no longer minors after turning 18 the law will not change.
Your support since separation can be used to rebuff a claim for retroactive support.
You cannot get a tax deduction for child support. You will need to word the agreement to specify that amount as alimony in order to get a deduction. You will also need to ensure that those payments do not end within 6 months of your youngest turning 18, otherwise the IRS could claim the payments were disguised child support and therefore not deductible.
Wow Erin, that is very helpful. I did not realize the recapture angle on CS. My youngest will turn 18 April 2012, graduate HS June 2012, but under my scenario we could not sell house until October 2012 and I’d have to pay the mortgage those additional months. Is that correct? Assuming so, please offer your advice on how best to proceed. I’d obviously like to get my equity out as soon as I reasonably can, and Oct is not typically a good month to market a house. So I THINK what you are saying is to word an Agreement that calls for alimony to match up to mortgage thru June 2012, and CS to match up up to college costs thru same June 2012, then let my wife actually send the money to the university for our oldest. Then we’d have a third component compelling me to pay college after June 2012. Correct? Are SA ever that complicated? Would you advise just agreeing on CS of say $1100, and college, and call it a day? Thanks in advance.
I would recommend that you pay child support through June 2012, pursuant to the guidelines. I am not advising that you pay college costs to your ex at all.
I am having trouble understanding why you do not have your wife refinance the home now in order to buy you out. You could then structure your alimony in a more normal fashion.
Without sitting down and actually reviewing your situation as a whole I can not advise you as to any specific amounts of support.
Well, I misspoke on my previous reply, but I understand your point. She will fight me, I believe, on any plan to have to refinance and buy me out, no matter how logical. And to be frank, I have an emotional problem with paying her anything that is called alimony. Plus I do believe that the particular circumstances of our house in this market, vs 2.5 years from now, make it a good bet I’d make money by waiting. But you cannot know. Anyway, I’ll wait and see what happens. If we head down my original path I’ll agree to mandated CS, plus maybe a little gross-up to get her approximately to the same monthly cash flow given she pays the mortgage and gets the deductions, plus college. Or maybe we’ll go your way and she can worry about the kid’s college expenses. Thank you again.
You are welcome, and I do wish you all the best.