How Will Your Arrears Affect Your Stimulus Check?
The coronavirus has led to a large majority of people being laid off from their jobs and forced to stay home in order to stop the spread of the virus. In an effort to help many Americans out during this uncertain time, the Federal Government has passed the CARES Act which provides that many Americans will receive a stimulus check based on their income and number of people in your family. However, what happens to your stimulus check if you owe back child support or arrears? Your stimulus check will more than likely be withheld or reduced by the amount of child support arrears that you owe.
While the CARES Act suspends some debts such as student loans or back taxes, the Act does not apply to any arrears owed on child support payments. This means that your stimulus check is still going to be garnished because the government wanted to ensure that people who need relief the most, like lower-income individuals with children, are able to get it.
The stimulus payment that is withheld or reduced by the child support owed by that parent will go to the appropriate state collections agency. The state collections agency will then issue the money to the custodial parent or the person due the child support. It is still uncertain how long the process of garnishment and payment to the custodial parent will take.
The garnishment of the stimulus check may also affect the spouse of the parent who owes the child support. The stimulus check is calculated based on either 2018 or 2019 tax returns. Normally, if you owe child support, then the arrears could be taken out of your tax refund. If you filed a joint tax return with a spouse who owes child support, you would file for injured spouse relief in order to qualify for your share of the tax refund without having the whole refund be garnished. However, the Internal Revenue Service has yet to issue any guidance on whether the injured spouse relief will be applied to the stimulus checks from the CARES Act. There have been different accounts from officials on whether the injured spouse relief will allow for spouses to qualify for their share of the stimulus check.
In addition to the garnishment of your stimulus check, if you have applied for unemployment benefits, your payments will also be affected by your child support arrears. If you have a child support order in place, then your unemployment payments will be withheld or reduced by the amount of child support owed. Some states will limit child support collection to 50% of each check so that the person who owes child support will still receive some benefits; New Jersey will garnish anywhere from 50% to 65% based on the amount of child support arrears and whether you support a spouse or child not on the child support order.
If you have any questions about your child support order or if you owe, or are owed child support arrears, please contact the experienced family law attorneys of Dalena & Bosch to schedule a consultation to discuss your needs and goals.