Miscellaneous. The department proposes the following additional changes:
•Assigning responsibility for payment of variable costs. The court shall assign responsibility for payment of the child's variable costs in proportion to each parent's share of physical placement, with due consideration to a disparity in the parents' incomes. The court shall direct the manner of payment to be either between the parties or from a party to a third-party service provider and not to the department or the department's designee. Variable costs are reasonable costs above basic support costs, including child care, tuition, a child's special needs, and other activities that involve substantial cost.
•Income imputed based on earning capacity. In determining a parent's ability to earn, the court shall consider a parent's earnings during previous periods and physical and mental health, in addition to the current factors of education, training and work experience, and availability of work in or near the parent's community. A requirement is added that evidence must be presented that due diligence has been exercised to ascertain information on the parent's actual income or ability to earn and that information is unavailable before the court may impute income at 40 times the federal minimum hourly wage.
•Shared-placement order with serial families. The concept behind the special provision for shared-placement parents is that the order is smaller than a full percentage order because the parent has significant placement and is covering the child's basic support expenses while with that parent. A shared-placement parent with one child is spending approximately 17% of his or her income on the child even though the child support order may be substantially less than that amount if the parents' placement periods and incomes are similar. The concept behind the special provision for serial families is to give credit for the amount spent on the first family before determining the order for children in the next family. The current serial family provision only gives credit for the amount of the order and does not consider the special situation of shared-placement parents with serial families. The proposed provision on shared-placement orders in serial families gives credit for the full percentage standard.
• Social Security disability insurance. The court may include social security benefits received by a child based on a parent's entitlement to federal disability insurance in the parent's gross income and may adjust the parent's child support obligation by subtracting the amount of the child's social security benefit. In no case may this adjustment require the payee to reimburse the payer for any portion of the child's benefit.
• Maintenance. If a payer will have obligations for both child support and maintenance in a particular case, the court shall determine the payer's child support obligation before the maintenance obligation.
•Effect of rule change. A modification of any provision of ch.
DWD 40 shall not be considered a substantial change in circumstances sufficient to justify a revision of a judgment or order under s.
767.32, Stats.
•Trust. The court may create a trust for the child if the payer's child support obligation exceeds the amount necessary to maintain the standard of living the child would have if the child were living with both parents.
•Undistributed income of a closely held corporation. Further detail is proposed to clarify when to include undistributed corporate income in gross income. The rule currently provides that undistributed income is included if the payer has ownership interest sufficient to individually exercise control or access the business earnings. The proposed rule defines undistributed income as federal taxable income of the closely held corporation, partnership, or other entity plus depreciation claimed on the entity's federal income tax return less a reasonable allowance for economic depreciation using the straight line method. The court may adjust gross income to include undistributed income not determined reasonably necessary for the growth of the business.
•Terminology.
- “Monthly income available for child support" is the proposed term to refer to the monthly income at which the child support obligation is determined. It includes gross income, or if applicable, income modified for business expenses; income imputed based on earning capacity; and income imputed from assets. “Monthly income available for child support" is similar to the current term “base," except “base" does not include income imputed based on earning capacity. A support obligation based on earning capacity is a separate calculation under the current rule.
- The proposed rule uses the term “split-placement" in place of “split-custody," which is incorrectly used in the current rule.
- The split-placement subsection is rewritten because the current rule refers to the payer and payee at the beginning of the calculation before it can be accurately known who will be the payer or payee.
Initial Regulatory Flexibility Analysis
The proposed rule changes do not affect small business.
Fiscal Impact
The proposed rule changes do not have a fiscal effect on state or local government.
Contact Information
A paper copy may be obtained at no charge by contacting:
Elaine Pridgen
Office of Legal Counsel
Dept. of Workforce Development
201 E. Washington Avenue
P.O. Box 7946
Madison, WI 53707-7946
(608) 267-9403
Written Comments
Written comments on the proposed rules received at the above address no later than March 31, 2003, will be given the same consideration as testimony presented at the hearing.
