Q. If my ex-wife just inherited half of a house from a relative and the house sells for a profit of about $200,000, can that reduce my child support payments? If so, do I submit an application as soon as the house is sold, or can I do it now that the house has already been let to her?
A. It’s not that simple.
It all depends on the very specific facts and circumstances of your ex and your divorce, your particular financial situation at the time of your divorce, and your particular current financial situation.
Once a child support obligation is established, it remains as originally dictated unless there is a subsequent mutual agreement by the parties or an order of the court, said Kenneth White, a licensed marriage attorney at Shane and White in Edison.
“In order to get a court order on your ex’s objection, you would have to file a filing statement and provide evidence to the court,” White said. “In order to qualify for judicial review and possibly change or end your maintenance obligation, you must meet your burden of proof by showing that a ‘significant, lasting change of circumstances’ has occurred.”
So what constitutes a “significant, lasting change of circumstances”? It’s very fact-specific, White said.
For example, if your child support obligation was set at $100 per week, that is a very different situation than if your child support obligation was set at $1,000 per week.
“If it was $100 a week, an argument can be made that your ex receiving a $200,000 lump sum benefit – a sum equivalent to 2,000 weeks of child support payments – is either reducing their child support needs as a result of the lump sum payment itself or significantly reducing it has the potential income that such a lump sum can generate and therefore the child support obligation should be reduced or terminated,” he said. “However, if the original obligation was set at $1,000 per week, a lump sum inheritance of $200,000 would likely not lead to the conclusion that there was a ‘significant, lasting change of circumstances.'”
Your ex’s and each other’s financial resources at the time the original child support obligation was determined are also relevant, he said.
For example, if you each had net worth of less than $100,000 at the time your child support obligations were determined, an inheritance of $200,000 may lead to a conclusion that a “substantial, lasting change of circumstances” has occurred, however, White said , if you both had or have net worth greater than $1 million, a $200,000 inheritance probably wouldn’t result in you securing an exemption from your initially designated alimony, he said.
White said that in analyzing whether a “significant, lasting change in circumstances” has occurred, there are many additional factors to consider that justify a review and possibly a modification or termination of a support obligation.
This can include your ex and your annual earned income at the time of the original child support versus today’s income and whether the child support was made “permanent” – permanent – or if it was set as temporary.
Given all the variables, it would make sense that you contact a divorce lawyer who can review the details of your situation.
Email your questions to Ask@NJMoneyHelp.com.
Karin Price Mueller writes the Bamboozled column for NJ Advance Media and is the founder of NJMoneyHelp.com. Follow NJMoneyHelp on Twitter @NJMoneyHelp. Find NJMoneyHelp on Facebook. Sign up for NJMoneyHelp.com’s weekly e-newsletter.