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Spousal Maintenance: Who Pays the Taxes?

Are you going through a divorce and it appears as if you will be paying your soon-to-be-ex-spouse spousal maintenance (alimony)? Or, does it appear that you will be receiving spousal maintenance from your spouse? Or, is there already a court order for spousal maintenance, and you are thinking about attempting to modify it? If so, you need to know the tax implications on the amounts you pay or the amounts you receive in spousal maintenance.

Minnesota Spousal Maintenance Attorneys

In the world of spousal maintenance in Minnesota divorce proceedings, there are several options including the amounts and duration of the spousal maintenance obligation, whether it is permanent or temporary in nature and whether the spousal maintenance obligation will be modifiable or unmodifiable (through a Karon Waiver). With all these options, both spouses need to know the tax implications of any spousal maintenance obligation before agreeing to spousal maintenance in mediation (or otherwise) or before addressing the issue of spousal maintenance in a divorce trial.

Spousal Maintenance Law Change Effective January 1, 2019

Prior to 2019, any amounts paid as spousal maintenance was always deducted from the income of the payor spouse and included in the income of the recipient spouse. Thus, it reduced the income of the payor spouse and increased the income of the recipient spouse. This made sense, since the payor spouse always has a greater income than the recipient spouse, which means that the recipient spouse also usually has a lower marginal tax rate. Therefore, by transferring this income from the higher income spouse to the lower income spouse, it usually resulted in a lesser tax liability, when looking at both spouse’s combined incomes and tax liabilities on a whole.

However, effective January 1, 2019, the IRS reversed this policy, and now made it so that any spousal maintenance payments made are no longer deductible from the income of the payor, and no longer included in the income of the recipient spouse. Therefore, in most cases, this results in a collectively greater tax liability between both spouses on a whole.

What about spousal maintenance orders that exist as of December 31, 2018, but are modified after this date? Under such circumstances, even if the spousal maintenance is modified in 2019 or later, the spousal maintenance payments will continue to be deductible from the payor’s income and included in the recipient’s income for income tax purposes. The only exception to this, is if the modified spousal maintenance order expressly provides for the opposite. So, if the order is silent on the issue, the tax implications that existed at the time of the original (pre-January 1, 2019) spousal maintenance order will remain in effect.

Contact a Minnesota Spousal Maintenance Attorney for Advice

If you have any questions regarding an existing spousal maintenance obligation, or likely spousal maintenance obligation that you may be paying or receiving, it is important for you to contact an experienced Minnesota spousal maintenance attorney to discuss the tax implications of the spousal maintenance and all other options and implications of the spousal maintenance payments. The attorneys at Blahnik, Prchal & Stoll are experienced and knowledgeable in all areas of spousal maintenance.

Holiday Parenting Time Disputes

With Thanksgiving a few days from now, and Christmas to follow shortly thereafter, tis the season for every family law attorney and Minnesota divorce attorney to start receiving the telephone calls regarding holiday parenting time disputes with their minor children. All too common in Minnesota divorce decrees and in Minnesota custody orders, are parenting time schedules that provide loose terms for the parties' holiday time with their minor children. Some orders do not provide for a holiday schedule at all, some simply provide for "alternating holidays," while others provide for specific holidays but not specific times for exchanging the children for holidays.

Minnesota Parenting Time Attorneys

This is most prevalent for Christmas parenting time when an order provides that "mom shall have the children on Christmas Eve and dad shall have the children on Christmas day." The question then becomes - when does Christmas Eve end and Christmas Day begin? Is it Christmas Eve evening or Christmas Day morning? For most little children, "Santa arrives" sometime overnight on Christmas Eve, prior to Christmas Day morning, so it makes a big difference. Also, many families have traditions on Christmas Eve evening, Christmas Day morning and for a Christmas Day dinner. Not to mention, many families will work in a visit to their church on either Christmas Eve or Christmas Day.

Usually, family traditions run deep with regard to where and when these holiday traditions occur. And often times, if the parties are not counseled properly during the divorce or child custody process, these details will not be addressed in the final custody order or divorce decree.

Also, I am frequently told by my divorce or child custody clients that, "Oh I can work out these details with my soon to be ex (or the father/mother of my children) because we get along well." Well, first I want to commend such individual that they have the current ability to cooperate with the other parent regarding these parenting time details. However, the key word there is "current" ability. Let’s say the parties have a two year old child, then they will have to cooperate for the next 16 years on such details (at least 16 years under the watchful eyes of the Court). And yes, it is true, many of these individuals are unable to agree as the years pass.

Include a Specific Holiday Schedule

Therefore, I almost always recommend to my divorce and child custody clients to include an extremely specific and detailed parenting time schedule and holiday schedule to use, if not only as a "default." By this I mean, if the parties get along well now, they can choose to deviate from the specific schedule. However, if the proverbial "push comes to shove" then they have a specific parenting time schedule to default to and there would be no need to make a frantic last minute call to their local family law attorney.

Contact a Minnesota Attorney Who is Experienced with Parenting Time Schedules

If you have a parenting time or holiday schedule that is not specific and is causing problems, contact the attorneys at Blahnik, Prchal & Stoll for advice and representation. Our attorneys are experienced Minnesota parenting time attorneys.

An Award of Attorney's Fees in Minnesota Divorce and Family Law Proceedings

Minnesota divorce and other family law proceedings can cost a proverbial "arm and a leg" in the form of attorney's fees. This is especially the case if no agreement can be reached and the matter eventually is decided through a multi-day trial. What if one parent or spouse has a much greater income than the other, and has a greater ability to pay attorney's fees? Or, what if one parent or spouse is pursuing relief from the Court that he or she clearly is not entitled to, forcing the other parent or spouse to incur unreasonable and unnecessary attorney's fees to defend him or herself?

These are the two situations where Minnesota Courts in family law cases can order one party to pay to the other party an amount as reimbursement for, or a contribution towards the other party's attorney's fees. These two situations are commonly referred to as (a) need-based attorney's fees; and (b) and conduct based attorney's fees.

Need-based attorney's fees are awarded if there is a substantial disparity in the parties' incomes and the Court finds that one party has the means to pay the other party's attorney’s fees, the other party does not have the means to pay the attorney's fees, and an award of attorney's fees is necessary to allow the other party to make a good faith assertion of that party's rights in the divorce or other family law proceeding. In such a case, the Court will award attorney's fees, costs, and disbursements in an amount necessary to enable a party to carry on, or contest the family law proceeding.

Conduct-based attorney’s fees are awarded against a party who unreasonably contributes to the length or expense of the Minnesota divorce or family law proceeding without a finding of either party's need or ability to pay the attorney's fees. Such conduct based attorney's fees are awarded if a party is pursuing a frivolous or meritless claim, the party fails to appear in Court or for a scheduled deposition, a party fails to respond to discovery requests, or the party simply engages in vexatious litigation that forces the other party to incur attorney's fees to defend.

Attorney’s fees can also be awarded if the parties expressly stipulated to it in their Minnesota divorce decree or other family law order. For instance, they could stipulate that one party shall pay a credit card debt as part of a divorce and shall indemnify and hold harmless the other party, and that if the party fails to pay the credit card debt the other party could recover reasonable attorney's fees in a post-decree motion in connection with enforcing the divorce decree. In such a case, the parties created a contractual provision to provide for an award of attorney's fees. This is consistent with the principle known as the "American Rule." In the United States, generally each party to a civil lawsuit is responsible for paying his or her own attorney's fees, unless a statutory or contractual provision provides otherwise. The ability to order need-based and conduct-based attorney's fees in family law proceedings is via the Minnesota family law statutes. The ability to order attorney's fees in the above-example would be based on the parties specifically contracting for an award of attorney's fees.

The issue of attorney’s fees is almost perpetually present in all divorce and family law proceedings. However, the Courts do not frequently award attorney's fees, and when they do, it usually only covers a fraction of the actual fees incurred by the party. And in the few cases where the Courts do award attorney's fees, a bigger problem normally results in the attempt to actually collect the attorney's fees from the other party after the Court has awarded them.

Marital House: Should I Stay or Should I Go?

If you are going through a divorce and you own a house, there are several factors that come into play as to whether you should pursue possession and eventual ownership of the house, or whether you should relocate to a different residence. An obvious factor in this decision, is whether there is equity in the home. The less obvious factor on whether to stay or go, involves the issue of child custody.

If there are minor children involved, as a divorce attorney, I will almost always advise my client to NOT leave the house – at least on a temporary basis. The reason for this is, if the Minnesota divorce is disputed/contested, and in particular if the issue of child custody is disputed, a decision will need to be made on temporary child custody and parenting time. One of the main objectives that the Court considers in assessing “the best interests of the children” to determine which parent will receive temporary custody, is to maintain the stability of the children. To maintain the stability of the children, the Court usually will want to keep the children in the house where the children had been residing. Thus, oftentimes, the parent who gets possession of the house pending the divorce, will also get temporary child custody (or at least the majority of parenting time) with the children. However, this is just a temporary order (a temporary fix) until a permanent solution regarding the house can be agreed to or decided.

As a part of any divorce proceeding, it is always an issue of “what to do with the marital house?” Normally, the house is an asset to be awarded to one of the spouses or to be sold with the net proceeds to be divided between the spouses. However, during the recession, oftentimes the spouses owed more on the mortgage than the house was worth, so the house was more of a liability. In such cases, the options regarding the house are more limited, and the spouses may agree to “let it go.”

A divorcing couple cannot stipulate in a court order that they will no longer pay the mortgage payments – because the Court cannot sign an order providing that the parties will violate the terms of their mortgage and promissory note. So, in these cases, it is usually “implied” that the payments will no longer be made. In such cases, one spouse will likely receive possession of the house during this process and they will each be liable for any costs and expenses associated with the inevitable foreclosure process.

When there is equity in the marital home, and when one of the spouses can afford the mortgage payments and other expenses associated with the house, can afford to pay off the other spouse’s interest in the home, and is able to refinance the mortgage to remove the other spouse’s name, then the Court will normally allow that spouse to remain in the home.

Should I Get a Divorce?

The title to this article is somewhat misleading, because it is one that I, as an attorney, cannot really answer for you. Having grown up in a Catholic family, my father still comments to me (I believe in a facetious manner) about my chosen profession as a divorce attorney and how divorce is more than frowned upon in such faith. Then of course the conversation inevitably leads to how I probably cause acrimony in the relationships of married couples I know for job security (which is, of course facetious).

The actual decision to get a divorce from a spouse is a decision that should be made prior to contacting a divorce attorney. Almost all of my clients who contact me regarding a divorce had made the decision to get a divorce months, if not years prior to actually mustering the courage to call. However, I have had a few clients during their initial divorce consultation tear up excessively when they tell me that they want to divorce their spouse. With these few clients, I could tell in their eyes that they were not ready for the divorce, for whatever their reasons may be - still hoping to mend the differences with the spouse, going to first try marriage counseling, the children will be too adversely impacted, the financial strain will be too great, the person does not know a life other than the life with that spouse, etc. Many of these are very legitimate reasons for delaying divorce, or to not get a divorce altogether.

The question of whether parents should stay together in an unhappy marriage for the sake of the children has been, and continues to be a topic of much debate. If the parents argue daily in the presence of the children and expose the children to a hostile living environment, then more harm may result to the children than good by remaining together. This could be the case on both an immediate level - by subjecting the children to a tumultuous environment, and on a long-term level - by teaching the children negative life lessons that will resonate with them as adults. However, if the parents do not argue, but have simply fallen out of love and are living two separate lives under the same roof while both looking out for what is best for the children, then is there harm to the children by staying married? In this situation, the parents must make an independent decision about their own happiness.

Whether someone should or should not get a divorce is a huge, and life changing decision to make. It is a decision that should not be made hastily and should be a decision made by that person alone - without the influence of peers, friends and other family. Friends and family can oftentimes provide good objective insight into the relationship from the outside looking in. However, every relationship is different and each person should know what is best for him or her.

If you have not made the decision to actually get a divorce, but you would like to know what your legal rights would otherwise be in the case of a divorce (especially if you believe your spouse is contemplating a divorce), contact our law firm for a free divorce consultation. By calling and speaking with an attorney, you do not need to actually follow through with the divorce. You would simply be learning your legal rights that would potentially result from the divorce proceedings.

Property Division: What Can I Keep & What Must be Divided?

So you find yourself either contemplating divorce, or in the middle of a divorce and need to know what your rights are with regard to all the personal and real property owned by you or your spouse. This blog will touch on the “ins and outs” of property division in divorce proceedings consistent with the laws of the State of Minnesota. There are two competing doctrines among the various States on how property rights are vested to married couples: “common law property” states and “community property” states. Minnesota is considered a common law property state or “marital property” state. In the United States, there are ten States that are considered “community property” states, which include, Alaska, Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. This article deals specifically with common law property rights within Minnesota.

So you find yourself either contemplating divorce, or in the middle of a divorce and need to know what your rights are with regard to all the personal and real property owned by you or your spouse. This blog will touch on the “ins and outs” of property division in divorce proceedings consistent with the laws of the State of Minnesota. There are two competing doctrines among the various States on how property rights are vested to married couples: “common law property” states and “community property” states. Minnesota is considered a common law property state or “marital property” state. In the United States, there are ten States that are considered “community property” states, which include, Alaska, Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. This article deals specifically with common law property rights within Minnesota.

As a Minnesota divorce attorney, it is critical to meet thoroughly with divorce clients to learn all the property interests owned by the divorcing couple and the “character” of those property rights. All property will be classified as either “marital property” or “non-marital property.” There is a presumption in the law that all property is marital. Thus, it becomes the burden of the spouse attempting to classify the property as non-marital to come forth with the necessary proof and evidence to consider the property non-marital.

So – what the heck am I talking about? What do I mean by marital property? . . . And non-marital property?

Per Minnesota divorce laws, all marital property shall be divided equitably between the divorcing spouses. Marital property consists of all property owned by the spouses that is not otherwise classified as non-marital property as explained below. To “equitably divide” the marital property does not necessarily mean to divide the property 50-50 between the spouses. However, in the majority of the Minnesota divorce cases, this is exactly what happens. But, if there is a large disparity in the spouses’ incomes, the Courts may award to the lower wage earner a higher percentage of the marital property.

So, what is non-marital property? In Minnesota, non-marital property consists of (a) any property that a spouse owned prior to the marriage; (b) any property that a spouse inherited at any time, either before or during the marriage; or (c) any property that was gifted directly and solely to one of the spouses (except gifts from the other spouse). If property is classified as non-marital, then that spouse is entitled to all of such property, without having to divide any portion of it with the other spouse.

To prove the non-marital character of tangible personal property is oftentimes not that difficult. However, when we are dealing with various bank accounts, retirement accounts or investment accounts, things get a little trickier. The spouse must properly and thoroughly “trace” the non-marital funds from their inception through the date of divorce. If the non-marital funds are commingled with marital funds, then that has the effect of converting the funds to marital funds. Thus, it is very important that the holder of non-marital funds retain such funds in a separate account . . . however, it may not be the most pleasant conversation to have with your spouse when you explain why you are retaining the funds in a separate account: “Honey – I am just keeping the money in a separate account, so in case we get divorced I will get to keep all the money.”

Similarly, if a spouse has a non-marital claim in real estate, it can be difficult to trace such a claim. This comes about when one spouse owns a home prior to the marriage, which has equity, then the parties sell that home and use the proceeds from the sale as a partial down payment towards the new home, and so forth and so on. There are many factors that come into play with this – too many to discuss in this article. However, it should be noted that when computing a potential non-marital claim in real estate, the Courts discern “active appreciation” (i.e. appreciation of the property due to improvements) with “passive appreciation (i.e. appreciation of the property due to market forces). Further, if at any time during the course of owning the real property, the actual equity in the property is reduced to zero, then this has the effect of eliminating any non-marital claim that may have existed.

As you can see, it can become quite complex when determining whether any non-marital property exists as part of the marital estate. It is always important to speak with a qualified Minnesota divorce lawyer to discuss your rights with regard to property and all other divorce issues. .

Can't We Just Agree?

As a Minnesota divorce attorney, a question that is often posed to me is, “Can't my spouse (or other parent) and I just agree to something on our own?” Normally, my answer to that question is a resounding “yes - the more you can agree to, will result in less arguing between the attorneys and less involvement with the Court. Also, the more you can agree, the easier it will be on your pocket book.

However, there are a few exceptions to the “let’s just agree to this and follow it” approach. First, if the agreement pertains to minor children in any manner, the Court will always apply an independent “best interests of the child” analysis. In other words, just because you agree to something, if that agreement negatively impacts minor children, the Court could reject the agreement.

With regard to child support, there is a legal presumption that our Minnesota child support guidelines must be used in all child support determinations. If you wish to agree to a different amount, you must provide to the Court an explanation on why this deviation from the guidelines is in the children's best interests.

For an initial child custody determination, the Court applies a “best interests of the child” analysis in determining proper custody labels and a proper parenting time schedule. If the parents agree to child custody labels and a parenting time schedule and provide an explanation for it, generally the Court will defer to this agreement. The Courts generally appreciate the parents reaching an agreement on custody and parenting time – because in most cases the parents know their children the best and know what is best for their children. So, if the parents can agree on custody and parenting time, the Court should adopt that agreement.

The tricky part arises when the parents wish to modify an existing Court order (a post-decree modification). For example, John and Jane got divorced. They had two minor children, Jenny and Jimmy. In the divorce, Jane was awarded sole physical custody, the parties were awarded joint legal custody, John was awarded parenting time every other weekend and was ordered to pay $1,000.00 per month in child support. One year after the divorce, John was terminated from his employment, began receiving unemployment and was home for the majority of the days. Based on this, John and Jane agreed between the two of them that they would modify their agreement to provide for joint physical custody, each parent alternating every other week of parenting time with the children and that neither parent would pay to the other any amounts for child support. John and Jane agreed to this in writing, each of them signed it, but they did not submit it to the Court for a Judge to sign and file with the Court.

John and Jane's agreement would be considered an “extra-judicial agreement.” Is it enforceable? Maybe.

Minnesota Courts have approved extrajudicial modifications of existing divorce decrees through stipulated agreements. There is a policy favoring the use of stipulations in divorce proceedings. But as referenced above, these stipulations are given considerably less weight when the agreement involves children. The Court is not bound by stipulations involving child custody, and child support stipulations are given less weight to protect the welfare of the children, which is the paramount consideration.

The enforceability of an extrajudicial agreement depends on whether the agreement is both contractually sound and otherwise fair and reasonable. To be contractually sound, the extrajudicial agreement must be supported by consideration. Consideration is "a benefit accruing to a party or a detriment suffered by another party.” The amount of consideration is not relevant. When two people make mutual promises at the same time that are reduced to writing, such promises are sufficient consideration for each other.

Also, to be enforceable, an extrajudicial agreement must not be unfair or unreasonable to (a) the children by causing an adverse impact on them; (b) one of the parties as a result of overreaching, a lack of disclosure, or lack of opportunity to consult with an attorney; (c) the State of Minnesota by causing one or both parties to seek public assistance; and (d) the Court by unnecessarily complicating future court proceedings. In determining the enforceability of an extrajudicial agreement, the Court may accept or reject the terms of the agreement in whole or in part.

In summary, just because you agreed to it, doesn't mean the Court will recognize your agreement. It is always best if you and your ex-spouse (or the other parent) can agree on the terms of your custody, parenting time and child support. But, if you do reach such an agreement, please incorporate that agreement into a stipulation and order to submit to the Court for a judge to sign as well. By doing this, you convert a semi-enforceable extrajudicial agreement into an enforceable judicial court order.

If you find yourself in this situation, please contact our law firm. We can assist you in converting your extrajudicial agreement into an enforceable court order.

Do I Need a Will or a Trust

We are often asked about how to successfully plan for retirement and whether the use of a will or trust is appropriate when doing so.  Many different factors play into the answer to that question.  If the person or couple has significant assets and are worried about the transition of wealth, perhaps a revocable trust is the best option.  Trusts are often used to shelter certain assets for the surviving spouse as well as any beneficiary named in the trust.  Other considerations for trusts are privacy concerns, blended family situations, and owning real estate in more than one state.  However, if the person or couple has relatively few assets but find that the assets are of some worth and significant importance, a will may be just as sufficient.  Wills can be drafted to account for real property and other measures can be taken to account for tangible personal property or cash accounts.  Contact our law firm to find out which option is best for you.

Minnesota Parenting Time & Child Support Laws Effective 2018

In August 2018, the Minnesota child support laws were changed to take into account every day that each parent has with the children for parenting time, to compute an appropriate child support obligation. Taking a step back in time, in 2007 the child support laws in Minnesota were changed to form a nexus between the amount of time that a parent has with a child and the amount of child support that the parent must pay. Prior to 2007, the amount of child support paid was contingent on the actual custody label agreed to: if one parent received sole physical custody, then the other parent was required to pay a set amount of child support (with some exceptions).

The 2007 changes made it so that the custody labels had no impact on the amount of child support to be paid, but instead, the amount of “court ordered” time that each parent had with the children was the deciding factor. Under the 2007 laws, there were two “parenting expense adjustments” equivalent to ten percent, and forty-five percent. Therefore, if a parent had parenting time with his or her children at least ten percent of the time, that parent would receive a 12% reduction in his or her child support, and if a parent had parenting time at least forty-five percent of the time, that parent would receive a 50% reduction in his or her child support. This was the battleground from 2007 until 2018, when the child support laws changed once again.

Under the laws implemented in 2018, there are no longer only two parenting expense adjustments. Instead, every day that each parent has with the children is factored in computing an appropriate child support obligation. In determining the number of days, the Court looks at the number of “overnights” or “overnight equivalents.”

Under the new laws, the parents are no longer battling for 45%, which has reduced the amount of litigation when one parent was just below that 45% threshold. However, one initial issue with the new 2018 law, is that most parenting time and child support orders from prior to 2018 did not specify the total number of overnights that each parent had with the children. Therefore, as we transition into the new law (where every overnight counts), it is now important to specify exactly how many overnights each parent has with the children.

One additional area of contention, is with the definition of an “overnight equivalent.” If one parent has the children from 7:00 a.m. until 7:00 p.m., and the children are then returned to the other parent, who simply puts the children to bed, who gets that day for purposes of determining the overnight or overnight equivalent? The day can only get allocated to one parent. This is an evolving area of the law that our Court of Appeals will likely be clarifying in the coming years.

If you are in a custody or child support proceeding right now, it is important to know your rights and it is important how your agreement (if any) is reduced to writing. If one parent has most “days” with the children and the other parent has most “nights” with the children, a compromise should be made on how those days & nights are counted for child support purposes. Contact our firm if you have any questions or need help with your parenting time or child support matter.

Minnesota Child Support: How Much Do I Have to Pay?

If you are in a position where you will either have to pay child support or will be receiving child support, I will provide an overview of the child support laws in the state of Minnesota. In doing so, I will also provide a quick summary of how we got to our current child support laws, which have only been in effect since August 2018.

The laws in effect from the 1980s until 2007, required the child support obligor (the parent paying child-support), to pay child support based on a percentage of that parent's net income. These guidelines provided for the individual to pay 25% of his or her net income for one child, 30% for two children, 35% for three children, and so on. Again, this was based on net income which was determined after income taxes were deducted, in addition to the cost of health insurance, a reasonable pension amount and union dues.

In 2007, Minnesota moved to an “income shares” model. Under this model, child support was based on both parties' incomes and based on gross income, not net income. The amount of child support to be paid was calculated by totaling both parties' gross incomes to arrive at a "combined parental income for determining child support." This parental income was then allocated between the parents proportionately. This is frequently referred to as each parent's "PICS" income. The changes in the child support laws effective in August 2018 did not change this step in the process of computing an appropriate child support obligation.

The child support laws that were in effect from 2007 to 2018 included two separate "parenting expense adjustments." A child support obligor got a 12% reduction in child support if he or she had parenting time with the children in excess of 10% of the time and a further reduction in child support if he or she had in excess of 45% parenting time. Under this model, it seemed to be a proverbial battleground in Court to get to 45% parenting time.

The child support laws that went into effect in August 2018, did away with the two parenting expense adjustments, and now count every day that each parent has with the children. So, in effect, there are 365 mini parenting expense adjustments. So far, it appears that our new child support guidelines are reducing the amount of litigation as it relates to the parenting expense adjustments, since there is no longer the “cliff” at 45% parenting time.

The current Minnesota child support laws also include provisions to allocate to each parent the cost of medical insurance premiums and out-of-pocket costs for the children. The cost for the children's medical insurance premium may be built directly into the child support obligor's monthly child support payment. The out-of-pocket costs are divided based on each parent's respective PICS income. Also, daycare costs may be included within the child support computations and included within the child support obligor's monthly child support payment. Typically, the obligor will pay something less than what his or her PICS income otherwise is, to adjust for the benefits of the daycare credit that the child support obligee (the parent receiving child support) may receive. The contribution towards the children's health insurance premium and contribution towards the children's daycare costs are "in addition to" the basic child support obligation.

Child support can be relatively simple to calculate if both parents are W-2 employees and work 40 hour weeks. Child support can be more complex when one or both of the parents are self-employed or if one or both the parents are unemployed or underemployed. The Minnesota child support laws do provide a presumption that each parent is capable of working a 40 hour week for child support purposes. If a parent does not provide sufficient documentation of income or is underemployed, the Courts are allowed impute “potential income” to that parent.

There are many other details of the Minnesota child support laws that I will not discuss here. One useful tool for parents who may be curious as to what their child support obligation may be, is the Minnesota child support calculator that can be found online. However, the amount of child support calculated by the Minnesota child support calculator is only as good as the numbers that are inserted into the calculator. It is important to seek advice from an attorney if you are needing to establish a child support obligation or needing to defend yourself in a child support proceeding.