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Modifying a Support Order After a Change in Financial Circumstances
Under New Jersey law, alimony and child support orders can be modified. This means either party (receiving or paying support) may ask the family court to have the support order changed.
Under New Jersey law, alimony and child support orders always are open to modification. This means that either the party receiving support (the "dependent" or "recipient" party) or the party paying support (the "payor" or "obligor" party) may petition the family court to have the support order changed. This change can be an upward or downward modification, depending on the parties' financial situation.
In order to successfully request a modification of a support order, the party must be able to show a substantial change in circumstances necessitating a change in the support amount. To be considered a true change in circumstances, the change must be continuing - it cannot be a temporary change. The change also must already have occurred. In other words, the court will not modify a support order based on the possibility of a future change in circumstances.
Loss of Employment and Decrease in Wages
In the current economic climate as unemployment rates increase and companies lay off workers, cut wages and hold back bonuses, payor parties may have financial difficulty meeting their support obligations. Conversely, parties dependent on alimony and/or child support payments to make ends meet may rely on those payments now more than ever before.
Traditionally, New Jersey family courts carefully have scrutinized any modification requests based on loss of employment or decrease in wages. The court wants to ensure these claims are legitimate and not a means for payor parties to circumvent their support obligations.
If the payor party accepts employment with lower wages, the party must prove to the court that the decision to accept the lower paying job benefits his or her career and that these career benefits outweigh any disadvantages for the party receiving alimony or child support payments. If the party is unable to do so, the court may impute an income based on the obligor party's capacity to earn and set support payments according to this income. The court will determine the party's capacity to earn by considering his or her background, education, training and skills.
In cases of unemployment, the court likely will request the obligor party to produce evidence that he or she is actively searching for a new job. The court may decide to lower the support payments or suspend them for a limited amount of time. If the court suspends payments, they may be held in arrears, meaning that the obligor party will have to pay back the missed payments.
Those who are having difficulty paying alimony or child support as a result of losing their job or being a victim of wage decreases should not wait to petition the court for a modification.
There is a two-step process for modifying support orders in New Jersey. First, the party petitioning the family court (the petitioner) must be able to show there has been a change in circumstances warranting modification of the support order. This is called establishing a prima facie case.
It is important to note that unlike alimony, children are entitled to a standard of living that reflects the parents' current standard of living, and not the standard the parents had during marriage, when the child was first born or while they were still together. Thus, if the payor parent receives a substantial increase in wages or receives some type of windfall (like an inheritance), then the recipient parent may request an increase in the support amount.
Second, if the petitioner is able to establish a prima facie case, then the court will schedule a hearing and allow for discovery of each parent's financial information. The financial information can include bank statements and tax returns, for example. During the hearing, the court will determine the extent of the change in circumstances and the effect this change has had on all of the parties before determining whether a modification is necessary.
The New Jersey family court is a court of equity. This means that the court will balance the interests of both parties to determine whether it is fair to change the support order. The court will consider the entire financial situation of each party and the effect a change in the support amount will have on each party. The court may consider any relevant circumstances in determining what is fair for all of the parties involved, particularly any children who may be affected by the modification.
New Jersey is an equitable distribution state, meaning that the division of property in a divorce is to be done fairly, not necessarily equally. The court can take into consideration any factor it deems relevant when dividing property, but it must consider certain factors, such as how long the couple was married and the age and health of both spouses, the income or property brought to the marriage by each spouse, the standard of living that was achieved during the marriage, and the extent to which one spouse may have deferred career goals, among others.
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