Parents involved in a divorce or child custody matter may often find themselves bombarded with paperwork, including documentation of income, assets and expenses, which they hope will end once the court makes a final ruling in their case.
However, any family law case involving child support can mean that the stream of paperwork will keep flowing until the child emancipates and a child support obligation creases.
This is because, in New Mexico, the courts maintain jurisdiction over the issues of custody, timesharing and child support until a child turns eighteen (18), or in some cases until the child turns nineteen (19) if they are still in high school. In turn, a section of the New Mexico child support statutes (2004 NMSA 40-4-11.4) provides that either parent may ask the other to exchange certain income and expense information on an annual basis.
All New Mexico child support orders should include some type of language requiring parents to exchange the following information at least once per year upon request by either parent: 1) federal and state tax returns for the preceding year, including all W-2 statements and IRS Form 1099s; 2) wage and payroll statements for at least four (4) months preceding the request; 3) proof work-related daycare costs and payment thereof for the preceding year; and, 4) proof of dependent medical insurance premiums and payment thereof for the preceding year.
The idea behind the annual exchange of income requirements is that parents should exchange this information every year in order to determine whether or not a modification of child support is warranted. Child support can only be modified by the court when there has been a material and substantial change in circumstances. The court will only find that a change in circumstances is material and substantial if it results in an increase or decrease in child support of at least twenty percent (20%). Thus, the courts want the parties to exchange income information and determine whether or not they meet the twenty percent (20%) requirement before either parent files for a modification of child support.
Not all parents request an annual exchange of income; some are content to carry on with an initial child support order for years. However, both parents are entitled to make the request and both parents are required to respond to such a request, which, depending on the age of their children, can result in parents exchanging paperwork for years and years. While the result of the annual exchange requirement may create a seemingly endless exchange of documents, it really is a good thing.
The annual exchange requirement is a method for parents to reevaluate child support yearly without necessarily having to involve the courts. If the income information shows that child support will not change, then the parents can go on their way until the next year. Or, if the income information shows that a modification of child support is necessary, then the parents can calculate and agree on a modification. Upon such an agreement, parents can simply submit as stipulated order memorializing that agreement to the court for approval. As long as the modification is clearly supported by a child support worksheet as required by the New Mexico child support guidelines, the court will likely enter the order and may not even require a hearing to do so.
Of course, the parents may not agree on a modification and may have to pursue court action to force the issue, but because of the annual exchange of income information, the parent pursuing the modification should be prepared to prove their case to the court. A parent on either side of a child support obligation is well-served to consult with an experienced family law attorney at any point in the child support process.
Experienced family law counsel can help parents complete and enforce the required annual exchange and handle the potential modification that comes from the exchange.