In PA, Inherited Money Increases Child Support

In Pennsylvania, money from inheritance raises the recipient’s child support obligations.  That’s true even if the person receiving the money has already spent it in ways that benefit the child.  Read about it here (FindLaw, 4/1/2000).  It’s an old case, but it’s worth knowing about.

It seems that the father of a 16-year-old girl received an inheritance from his mother of $83,000.  He had a family who lived with him, so he bought a house with the money he received from his mother’s estate.  The new house presumably was a good thing for his daughter whom the article describes as living with “an adult relative.”

But when the “adult relative” found out about the dad’s inheritance, she went to court to get a piece of the pie.  And the court said ‘yes.’  It increased the father’s child support obligation “substantially.”

 The law defines “income” for support purposes as including all ordinary income as well as “other entitlements to money or lump sum awards, without regard to source, including lottery winnings, income tax refunds, insurance compensation or settlements, awards and verdicts and any form of payment due to and collectible by an individual regardless of source.” Also included is “income from an estate or trust.” Pennsylvania courts have long based support obligations not just on a parent’s actual earnings but also on his or her earning ability and financial resources.

Now, the dad argued that what he received wasn’t “income from an estate or trust.”  That is, what he received was the principal from the estate, not income.  If he’d invested it in, say, municipal bonds and received periodic payments of interest, that interest would be “income from an estate.”  But that’s not what happened.  In fact, he reinvested the money in a non-income producing asset, i.e. a residence.

And the court agreed that the money he received was not in fact income from his mother’s estate.  But no dad gets off that easy.  The court ruled that what the father had received from his mother qualified as “other entitlements to money… without regard to source.”  So it raised his monthly obligation to reflect his receipt of the $83,000.

Never mind that he no longer had the money.  Never mind that he spent it responsibly by buying a better house for his family and his daughter when she visits him.  And above all, never mind that the payment was a one-time thing, but child support payments go on every month, every year.  And finally, never mind that his actual income from which he pays his child support didn’t go up a penny.

No, all of that must take a backseat to his obligation to support his child with whatever comes to hand.

But wait.  He was already supporting his child and no one argues that he wasn’t or that he was doing so insufficiently.  The girl’s “adult relative” received what the court ordered and there’s no indication that it wasn’t sufficient to meet her needs.  So if child support is really about, well, supporting the child, the dad was doing that.

And yet, when he receives a windfall, suddenly his child’s needs miraculously increase in lockstep.  Again, the money is gone, invested in his residence, so where he’s going to get the wherewithal to pay the increased amount is anyone’s guess.  But irrespective of that, it seems painfully obvious that Pennsylvania law and the court’s action have far more to do with Mom support than they do child support.  As I said, the girl was supported well enough before he received his inheritance, so why not afterward.

Worse, like most inheritances, his was a one-time-only event.  To the extent the state can pretend it’s income, it only happened in one year.  But his child support obligation doesn’t end in that year; it goes on and on until the child becomes 18 or 21.  So, if he can pay the increased amount, and my guess is he can’t (again, the money he receives to pay his bills hasn’t increased a bit), he’ll be doing so month after month, year after year because the court decided his income had all of a sudden increased by $83,000.

That will happen, that is, unless he spends still more money next year to hire a lawyer, go to court and explain to the judge that he hasn’t received another inheritance and his “income” has once again declined to what he receives from his employer.

In other words, a colossal waste of time and money to do what should have been done in the first place – recognize that the money had already been spent, that the child benefits from the expenditure and that the father’s actual ability to pay hasn’t increased at all.

This silliness would all be solved if state legislatures would take a less punitive, less misandric and more commonsense approach to child support.  That would mean setting amounts for child support that reflected what’s actually needed to support a child – I’m not talking some bare-bones, spartan existence, but something reasonable – and letting it go at that.

The idea that Pennsylvania’s approach has something to do with a child’s needs is plainly at odds with the truth.  The increase in this case was about supporting Mom, not the child who was already sufficiently supported in the first place.

My guess is that there’s something else at work as well.  The notion that any Mom gets a big chunk of anything extra that Dad takes in impacts family dynamics in another way; it tends to keep the child in Mom’s custody. 

In the case in question, the child in question was 16 years old.  In most states, that’s well old enough for her to have gone to court and told the judge with which parent she wanted to live.  And by that age, the judge will pretty much go with the child’s wishes absent some indication that she’s motivated improperly.

An improved living standard on Dad’s part, brought about by a better job, an inheritance, a new wife with strong earnings, might just be enough to convince a teenager to move in with him.  And we can’t have that, now can we.  So legislatures and courts are at pains to take any little extra Dad may receive, give Mom a share and pretend it has something to do with supporting an already-supported child.

That’s life in family court.

Thanks to Ned for the heads-up.

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