How Parents’ Finances Impact Custody Battles

Engaging in a child custody battle can be time-consuming and expensive for all parties involved. The average child custody lawyer may cost anywhere from $1,200 to $4,500 to hire, though the cost may be higher if the case drags out over an extended period of time. When one parent makes significantly less than the other or has no income at all, it can spark fears that they might be at a disadvantage in a custody case. There are, however, other factors that come into play when deciding custody, aside from income.

Income and Child Custody

When a child custody case makes its way to court, the income of either parent is generally not the sole factor that affects the court’s decision-making. Instead, courts tend to focus on the best interests of the child when deciding how to award custody and to whom. In New York State, for example, the court considers all of the following when weighing custody decisions:

• Stability of both parents
• Child care arrangements
• Who was the primary caretaker prior to the filing of a child custody case
• Drug and alcohol use
• Mental health of both parents
• Physical health of both parents
• Evidence of domestic abuse on the part of either parent
• Evidence of child abuse, neglect, or abandonment on the part of either parent
• Child’s preference for living with which parent
• Where the child’s siblings live
• Educational opportunities available for the child
• Court’s observation of the parents
• Finances of each parent

In terms of how finances can affect custody decisions, the court looks at each parent’s ability to provide financially for the child. For example, if one parent is homeless and unemployed, they obviously have a lower chance of securing custody because they’re unable to provide housing for the child.

On the other hand, if one parent has no income because they were the primary caretaker of the child, the court may consider their ability to earn an income going forward as a deciding factor in a divorce. The court can also take into account payment of spousal or child support to a stay-at-home parent.

Income can also play a different role in child custody cases in terms of motivation and means to pursue a custody case. If one parent always stayed at home, for example, while the other was the primary breadwinner, the former may lack the resources to engage in a lengthy court battle. Conversely, a parent who seeks to avoid or minimize their financial responsibility for child or spousal support may not raise custody issues at all.

Income and Child Support

When deciding child custody, the courts can also consider whether it makes sense to award child support to the parent who will be primarily responsible for caring for the child. States can use different models to determine how much child support to award.

• Income shares model—With this model, the assumption is that the child should receive the same proportion of parental income from the noncustodial parent that they would if both parents still lived together. Forty-one states use it for determining child support.
• Percentage of income model—The percentage of income model establishes child support as a percentage of the noncustodial parent’s income. The income of the custodial parent is not considered in these calculations. Four states apply a flat percentage model, while two use a varying percentage model.
• Melson formula—The Melson formula is a variation of the income shares model and aims to ensure that each parent’s basic needs (as well as the basic needs of the child) are met.

In the case of child support, earning a higher income could mean paying more, though it can depend on the model that’s used in your state. If both parents are equal earners or child custody is split equally, the court may decide that no child support is necessary for either parent.

For all divorces finalized on or after Jan. 1, 2019, child support is not tax deductible for the parent who pays it. It’s also not considered to be taxable income for the parent who receives it. Child support can continue until the child turns 18 or 21, or completes college, depending on the terms of the court order.

Income and Spousal Support

It’s possible that a parent who is seeking custody of one or more children during a divorce may request spousal support as well as child support. Spousal support, also known as alimony, is a form of court-ordered financial support that can be paid by a higher-earning parent to one with a lower or no income. All states recognize alimony, though the laws regarding it vary from state to state.

In California, for example, the court may order one partner to pay spousal support to another in monthly installments following a divorce. Couples who have domestic partnerships may request partner support. The amount a spouse or partner can receive depends on:

• Earning capacity, including their marketable skills and ability to get a job
• Financial standard of living they were used to during the relationship
• Length of the marriage or domestic partnership
• Evidence of domestic violence on the part of either spouse or partner

In terms of how long spousal or partner support continues, California lists three conditions:

• When support is ordered ended by the court
• In case of the death of one spouse or partner
• If the spouse or partner receiving support remarries or enters into a new domestic partnership

Other laws have more specific guidelines for how long support can last. In Massachusetts, for example, you can receive alimony for no more than 50% of the number of months you were married or as long as the judge thinks is fair, depending on how long you were married.

When one spouse makes significantly more than the other, it can have a direct impact on alimony decisions in cases where it’s clear that the other spouse needs support. If both spouses have similar incomes or earning capabilities, the court may rule that spousal support is not necessary.