Kiss Your Financial Privacy Good-Bye
By: Christa D. Banfield, Esq.
Most people, when going through a divorce, grudgingly accept the fact that every facet of their financial life will be laid bare in order to divide it up. What people don’t think about is the fact that, if you have minor children, you will not have any financial privacy until those kids graduate high school. Considering a relationship or marriage with someone who has kids? Be prepared to lose your financial privacy to some extent as well.
Arizona’s Child Support Guidelines require that all decrees/orders that involve child support include a provision that the parents exchange their financial information every 24 months. This includes- at a basic level- tax returns, W2s, an end-of-year paystub, etc. If you’ve re-married, and you file joint tax returns, no amount of (allowed) redacting is going to hide the stepparent’s earnings.
As if that isn’t enough, if there is actual litigation ongoing for a child support modification, the Arizona Rules of Family Law Procedure state that “parties may obtain discovery regarding any matter, not privileged, that is relevant to the subject matter involved in the pending action…if the information sought appears reasonably calculated to lead to the discovery of admissible evidence.” What does that mean? If it’s related to your finances, it’s on the table. Bank statements, mortgage statements, loan applications- all of it. There is no practical way, as a stepparent and new spouse, that a bulk of your information will be kept private and away from the eyes of the other biological parent especially if it is mixed altogether as couples normally function.
And I’m not just talking about keeping your information private from your partner’s ex. Your stepchildren will know way more about your household finances than appropriate. Children in intact families rarely know their parents’ incomes or details about the budgeting. Unfortunately, kids in divorced families are unfortunately drawn into these adult matters all too often. Upset parents will throw out details of the other parent’s income, monthly child support amount, and spending habits, forgetting (sometimes intentionally) that this type of “venting” is best saved for their friends when the children are not around. Then the next thing you know you’re explaining to an 8-year-old how taxes work and how much the mortgage payment is and how no, their gymnastics is not tied directly with the payment of child support. But I digress.
Looking again at the Child Support Guidelines, there is a provision which “protects” the stepparent’s income in another way, as they state that a stepparent’s income is not included in the parent’s income for calculation of child support. Therefore, technically, there is no legal obligation for a stepparent to provide financial support for their stepchildren. That can be illusory though in application by the court. What about the situation where a parent remains voluntarily idle in their career or underemployed because they’ve re-married someone who is financially well-off or has substantially more income? In that case, it may be possible to request information about the stepparent’s contributions towards the living expenses of their new spouse and allow that information to be used in assessing that biological parent’s benefits and defrayed living expenses from this additional income – thereby in all practical aspects including the stepparent’s income for child support purposes. Or you can request that the court deviate from the Guideline amount of child support if you can show that amount is inappropriate/unjust as a result of benefits derived from the stepparent’s income or financial status. Deviations are very fact-specific, though, so check with an attorney to see if your case would qualify.
And let’s be realistic- if you have a child in your house, biological or step, you will be financially contributing to their upbringing. Most stepparents are accepting of and ok with this fact. Rarely do I hear of a stepparent complaining about the cost of birthday presents or back-to-school clothes. Where the issues arise is when the contribution seems to turn in to a requirement because of the perception (real or imagined) that the ex isn’t paying their fair share.
If you’re a biological parent or stepparent dealing with child support issues, and you would like to meet with one of our experienced Attorneys, please call OWENS & PERKINS at480.630.2464 to schedule your free 30-minute consultation.