Congress Tags Child Support as Luxury Income; Collection System an Economic Failure
Fathers have complained about arbitrarily high child support orders for almost two decades. Class action suits were filed, the fathers’ rights movement grew, debates broke out in academic journals, a few social scientists demonstrated with calculations and documentation, some men committed suicide because they were unable to support themselves, and a few serious investigative journalists analyzed in depth.
Congress finally decided to act – with a flat luxury tax on child support income.
Starting next month, parents will see an “annual fee†of $25 deducted from child support payments as part of a new federal law. It applies to families not in the welfare entitlement system, but who have been forced into the federal child support collection system. Child support money is already taxed at the payer’s end as part of regular income with no deduction.
On the basis of constitutional law, child support, along with other marriage and family issues, is a private issue that has historically been handled in state civil proceedings where at least some modicum of individual civil rights was observed. Laws enacted during the Reagan years ultimately led to the legal reclassification of marriage and family as “social policy,†incorporating them fully into federal welfare programs. This upset the entire balance between personal life and government intrusion.
At stake were billions of dollars each year in federal hand-outs to states for the operation of highly computerized child support collection systems that initially most states did not want. Each state already had computerized welfare systems and found no advantage in the new product being forced on them by the federal government. Congress responded by allocating money to pay the bill and added incentives to drive higher income, non-welfare families into the system. The private collection industry joined the fray and the era of intense “deadbeat dad†propaganda began.
The incentive payments – based on the amount of child support paid through each state’s system – also provoked arbitrary increases in the amount of child support ordered. This increased both federal payments and collection industry profits. In response to class action lawsuits, federal courts reclassified marriage and family as “social policy.†This secured the federal invasion and allowed arbitrary political control of private child support amounts, as with the setting of welfare entitlement levels.
The application of child support laws needed some work. Although never properly analyzed, there were many complaints that the amount ordered depended largely on the judge making the decision. Inconsistency was the basis for replacing case-by-case decisions with politically-determined child support formulae, which still differ from state-to-state. The signal that arbitrary political control was not a solution was immediate, particularly for low income families. Low income payers were often ordered to pay more than the income they received. Higher income payers, shocked by the new gap between any reasonable assessment of their children’s needs and payment levels were simply told, “you can afford it†(you mangy greedy deadbeat who dared ask).
There have since been serious efforts to define appropriate child support formulae, such as here, but they have been virtually ignored in political circles. Reducing amounts ordered to reasonable levels would lower income from the federal program.
The clumsy and destructive force of draconian political control is more often reported when it harms custodial parents. The luxury tax will be charged to any custodial parent who has received more than $500 in child support. Parents receiving greater amounts may be getting the message, “you can afford it,†but questions have been raised about those receiving small amounts. That might not be the right place to focus attention.
The purpose of the tax is to pay down the federal deficit. Why should the deficit be a particular problem for child support payers and recipients? For children of divorced and never-married parents? More money is needed to pay for security and defense in these troubled times, but that certainly does not account for special focus on this particular group.
The answer lies in the cost of the federal child support collection program. In the 1990s, promoters called it an “investment.†There was consensus among promoters that spending on child support collection would more than pay for itself by reducing welfare dependency allegedly stemming – not from inability to financially support a family – but simply because “deadbeat dads†were allowed to “get away with it.†Other taxpayers, paying their children’s bills, should be outraged, they argued.
But, aside from a small percentage of cases, easily dealt with through means available to state courts, this was never the case. Statistics showed correspondence between non-payment and poverty – i.e. low and no-income fathers. Statistics on “collection†since the start of the program have shown no significant increase in the percent of the amount ordered that is paid.
Proponents of the program – including the state and private collection industry – often misreport “collections†to payment ratios by including all regular payments forced through state systems. Payments that would have been paid directly between payer and recipient if not forced through the government system comprise most of the “collections†reported for both promotional purposes and for calculation of federal incentive payments. They are not problem payments that ever required action to collect. They are primarily from non-welfare related cases that would not impact the cost of welfare programs even if they were “collected.”
The luxury tax on child support is specified in the Federal Deficit Reduction Act of 2005 specifically for the purpose of paying for the child support collection system. The decision – backed by GAO assessment – clearly demonstrates that the program has not paid for itself and does not have the potential to do so. The question that needs to be asked is; Why is this program not abolished?
| More from Roger F. Gay
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August 16th, 2008 at 6:23 pm
you have got to be KIDDING me… a LUXURY tax on child support… I supported my son ALONE for 12 years before my ex reliquinshed his rights. I ALONE worked three jobs to support my son and finally this DEADBEAT was made to pay me something and I DO NOT CONSIDER IT A LUXURY, I consider it reapayment for years of NO SUPPORT.. HOW DARE ANYONE charge a fee or a TAX on funds that are DUE. DEADBEAT people should be made accountable, the victims are the custodial parent and the child, who are now also being TAXED for something that is cleary SUPPORT NOT A LUXURY! WOW must be a DEADBEAT being made to pay up that wants the hardworking single parent to pay for this “luxury”.. it sickens me.. The deadbeat should be made to pay any tax or fees.. NOT THE RECIPIENT.. I only had the state collect due to the deadbeat writing BAD CHECKS..
August 16th, 2008 at 11:40 pm
Intersting to see someone accepting the idea of the tax to begin with. It seemed so clear to me that there shouldn’t be one.
August 17th, 2008 at 6:07 am
Perhaps we can take Britain’s queue — they realized their system (which was not as nasty as America’s) was a failure, dumped it, and are reforming it.
August 17th, 2008 at 8:17 am
Sounds good Dave. Britain followed the US into the mess back when Clinton and Blair were good buddies. New Labour was partly about – not as brutish as the American version of father bashing – but definitely a little about the false hope of curing social problems by punishing people who don’t fit politically correct models. (Didn’t Hitlar and Stalin think of that first?) Just send those lazy single mothers to work and make dads pay, etc. Nice – when all you have to do to cure a problem is say what you want the outcome to be – wave the magic wand of intimidation – and there it goes. (Not!)
If Britain pulls out of this, they won’t be the first Europeans to do so – and I suspect won’t be the last. I guess we’ll be hearing from the feminists this season about cut-backs to related programs in the US. Let’s hope so. I’m ready to rumble.
August 17th, 2008 at 12:24 pm
And of course we all know what this really means – if they were to tax the mothers for child support payments they receive, this will trigger the feminists and their chivalrists in the state legislatures to bring up yet another round of child support increases to further compensate for this “loss to mothers.”
It just passes on to the fathers and to the children, now this would be similar to being triple taxed:
First, dads don’t get the money in the first place.
Second, dads have to pay tax on that money they don’t get.
Third, dads now have to pay more child support to make up for the bogus tax on mom and the kids…
Logic? Fairness? Justice?
WE must make the public aware, and both the ignorant and the crooked legislators aware that we are on to them and won’t let them get away with this type of fraud, abuse and slavery and pillage of the village any longer.
Besides, when you get to the final outcome of all of this parasitic industry’s agenda, it exploits and abuses the women and children they are “protecting” when they fuel anti-father hysteria and abuse. Don’t they even care about women and children? No!
Everyone loses, except for the industry and their legislators.
August 17th, 2008 at 3:35 pm
It’s is not when the “government sponsored extortion racket” billed as the child support system will fail, but when? It won’t work, sooner or later those being stole from and violated will not go along anymore. The money will be cut off and those who run this “racket” will be on the dockets of justice and the women who benefited from it will be forced to “grow up” socially,legally and morally.
I advise everyone out there being “stole from” and yes it is stealing, to learn the law. Put a stop to it, like I did and begin the process of either bringing these “theiving terrorist” under control or getting rid of them! It can be done.
Replace the government sponsored kidnapping and extortion racket with a private arrangement, where you can put pressure on exspouse and force a more fair and equitable arrangement on them. You still have to provide for your children, yes they are yours, reguardless of what the state says. You can do it with some control and force the exspouse to agree to something that respects your rights and status as a parent, not a visitor and financial support, although, you will still do both those functions. It’s not perfect, but once the state and its greedy money grubbing thieves are removed, the whole affair gets to be a lot more pleasant.
August 18th, 2008 at 12:01 am
Roger’s article adequately summarizes what has happened and echoes the program’s failure. The state workload could be reduced substantially IF courts generally allowed parents to split the child time so that support orders are unnecessary or greatly reduced. People forget that many fathers want their children for at least half of the time because that is part of being a father. The courts often IGNORE that there are basically two categories of men: those who leave their families for purely selfish reasons and those who are pushed away from their families by the court system…The court bias to adhere to the mother rather than the father’s wishes reduce most men to uncles who are forced to pay a substantial tax or go to jail. If the courts respected and treated parents equally, much of this problem would be solved…but the government like the medical industry would rather treat than solve or cure the problem…there’s more money in maintaining a problem than ending it!
August 18th, 2008 at 12:04 am
Thank you for your comment Josiah. It works in Sweden. The fundamental fairness is perceptibly fair because it matches human nature. That’s why it will work anywhere.
August 18th, 2008 at 5:39 am
With 70% of divorces filed by women…Watch out. Guys need to marry your way into wealth!…Do what women do or teach that dog to hunt. All is fair in love and divorce.
August 18th, 2008 at 6:15 am
Interesting idea NOWMEN.NET. I think it suggests how far people would have to go to adapt their behavior to survive government policy. I mentioned in a previous article – don’t remember which one – that it’s gotten difficult for people to just get to know one another naturally, fall in love, focus on their concern for one another, etc. I’ve focused a lot of attention on corruption of government and constitutional rights. I suppose there does need to be more focus on the social damage it’s causing.
August 18th, 2008 at 8:07 am
Its unfortunate. I look at this way..Men will not organize. So we have to use the system to our advantage. If men do to women what women do to men..the women organizations will march on Capitol in heartbeat and the laws would be changed. Men are are embarrased and afraid of backlash from girlfriends and wives. It’s sad. But with women holding nearly half the assets and half the businesses in the U.S. It’s time for men to use this as an advantage to get what they want.
August 18th, 2008 at 8:20 am
I think – after Roe v. Wade, women haven’t really done so much marching. There are a few politicians doing quite well from organized fund raising, and they’re agenda is entrenched in the pork system. If feminists were to be dragged out into the streets again – facing public scrutiny and debate – they wouldn’t stand a chance.
I think the political power of feminists (”women” is both a broader and different classification, and in fact “all feminists” is really too broad for what we’re talking about) is over-rated. Politicians are mostly interested in the pork-barrel systems and corruption they’ve created. That’s the original motive and lasting legacy.
The thing about “social issues” and “social policy” in the public mind is that people are used to endless discussion and debate and tend to ignore it – everybody’s entitled to an opinion anyway (except on certain issues). And a lot of it seems to most to be somebody else’s problem anyway – no time for that.
I think the problem with your plan is that courts don’t take money from women to give to men. They would if the constitution was being respected – but that’s been water over the dam for decades.
August 18th, 2008 at 9:23 am
The courts didnt kick in for my support to come to this woman for the first 15 years.. This woman did NOT get public assistance, I worked three jobs to support my child on my own. It’s too bad that “MEN” think that all women rip off the man that cheated, stole, drank and pissed the marriage away all because they were JEALOUS of the child that they created! I do not feel that the “Women” are the bad guys here ,, some are the deadbeats but in my case it was the man that was the deadbeat and I suffered.. to make me pay extra for the courts to help me (wasnt the government founded FOR THE PEOPLE?).. If our forefathers knew how corrupt the government has become, over taxing without representation they would be appalled. We would need much less taxes if the government would weed out the unnecessary positions being held and make the senators and representatives collect social security instead of the people having to pay them for the rest of their lives… they are supposed to be common people looking out for common people.. but its actually, the rich looking out to ROB the common people of not only their diginity but their MONEY!
August 18th, 2008 at 9:45 am
Yes, Youwished. It’s a rip-off. There may be a lot of MEN here, but you’re certainly safe in expressing that view here. We’ve been saying so for years.
August 18th, 2008 at 9:47 am
As a divorced dad (read: non-custodal parent), the county government charges me $35 yearly to pay them for my wife’s child support servirce.
Also, the county government charges me $4.00 per copy of a Support Report (which is always inaccurate). One would think that they would send a free statement monthly – if they were so concern about regular payment.
Lastly, the county governments receive over $4 billion dollars from the federal government (your Social Security) to create support orders and arreages.
http://www.ssa.gov/OP_Home/ssact/title04/0458.htm
August 18th, 2008 at 9:57 am
Interesting link mrfullo. I didn’t feel like spending a couple of hours trying to figure it out, but it looks like the >$500 million is per state per year but there are incentive payments for both paternity establishments and the percent cs payments forced through the state system, and then an effectiveness incentive. I don’t know how to combine the three – but have been wondering – not just about the total amount spent on incentive payments – but the whole bill. If incentive payments are running $4 billion a year – that’s 4 times what Congress originally intended to spend on the whole program – and only a small part of what they are spending now.
August 19th, 2008 at 9:53 pm
mruffalo, Roger, creating the maximum governmental budget possible, with the maximum number of employees of the government possible, the maximum empires and spending possible, THAT is the primary incentive of government!
It is NEVER about saving the taxpayers any money!
Until one understands this fundamental principle, NOTHING government does makes any sense!
WHEN one understands this principle, EVERYTHING government does makes sense!
The measure of success with the Child Support Crusade is NOT that children are being supported. That is what happens when both parents remain together in an intact marriage and we don’t ship our jobs overseas for cheap labor!
No, the measure of success of the Child Support Crusade is the number of people it employs, and the amount of money they spend.
Just like every other government program!
Are we imprisoning more convicted felons in more prisons? Yep! Are not most convicted felons raised without their fathers? Yep! Yet another measure of success for no fault divorce and the Child Support Crusade!
When a police officer told me that crime doesn’t pay I responded, “It pays you!”
So when you say that $4 Billion per year in “incentive payments” to the states is 4 times what Congress originally intended to spend, give me a break!
It is but a fraction of what they intended to spend!
August 19th, 2008 at 10:52 pm
Roger Knight: In the 1980s, Olof Palme pushed the plan in Sweden (along with being a Soviet supporter) till government was larger than the private sector. Then somebody shot him.
August 22nd, 2008 at 4:47 am
Why should men pay child support at all if they have no reproductive rights what so ever and women are the sole arbiters of reproduction? That is like taxation without representation.
August 28th, 2008 at 2:33 pm
Good point Joi! Technically the income from child support is used to support the custodial parent. If they manage the money then let it be taxed. 90% of the Fathers who do pay support don’t get the write off for the child or any leniency when it comes to the tax law. My attitude is if you pay then reap the federal rewards. (including claiming the child & *custodial parent* as a dependent, afterall the custodial parent IS dependent on that extra cash flow). And it is extra cash flow coming into that household.
Editors note: Single mom who raised two college educated sons. On my own single income. Women are given two legs, stand on them more instead of stomping men for support.
January 15th, 2009 at 1:50 pm
Lady you are bitter. chill the heck out. My husband is being ordered to pay $2200 of suppport on a teachers salary. We see his kids almost 1/2 the time, they eat dinner with us 14 days out of the month, one more over night a week and we would not need to pay support at all. We prove a home, clothing, food everything his childen need. Yet, my son suffers as we are now struggling to make ends meet and are losing our home over this. I will be forced to work harder and longer hours to provide for the entire family (includin his kids) while his ex gets his entire salary. Child Support is a burden to the system and unfair to fathers and new families. Good intending- hard working dads are being hurt because woman like you can not just let things go. Did I mention his ex is a lawyer and chooses to work 2 days a week. It is hurtful to all involved.
January 15th, 2009 at 2:07 pm
I am a female and feel child support is only about revenge and has been taken too far and should be removed entirely from the system. At the most, both parents should put a nominal amount of money in a savings account for when the child(ren) is grown to use when he turns 18 or 21. A woman is more then capable of supporting herself these days. If childcare is an issue, we should focus on universal paid or reduced childcare instead of welfare and tell moms to get off their butts and work for a living instead of taking handouts from presumed fathers and the state. It's terrible what gov't is doing to well intending fathers who want to be with their kids. If a father doesn't want to take responsibility physically and financially nothing will force them. Mothers should figure it out they chose a bad father and he is not capable or wanting to care for their child(ren) they need to move on with their lives. Maybe the next man they choose will be better. Layoff the men. They are already struggling – taking away their freedoms and rights isn't helping the situation. It simple makes them want to give up on a no win system.
January 15th, 2009 at 4:41 pm
Roger Knight hit the nail on the head. I’m glad to see that some truly understand what’s happening.
Thanks LeeAnn Nelson for commenting on this important issue. In my opinion, it’s a matter of equal protection, (not poor choices) and I agree the persecution needs to stop. We can’t stop people from making bad choices, but we can insure they are afforded equal protection under the law.
This insanity is bankrupting our country, destroying lives, and robbing us of our heritage as a free people. Few issues in America are as important as this, and naturally, it receives the least amount of media coverage.
January 29th, 2009 at 6:38 pm
you knew the kids existed when you married him. Its a package deal. YOU chill out.
January 31st, 2009 at 2:35 pm
cliff notes how corrupt is CS system going back to court to stop them from taking 80% of SSD check CS turns around and trys to reopen case that was dismissed 2 years ago when ask why was told by caseworker that she had to look into it .fact is she is the one who sent the letter.And as usual response very quick .Now on 6 day of waiting.
April 30th, 2009 at 10:14 pm
I waited 5 yrs for SSD ( slow system ) got behind , now they take almost half my check, i emancipated my children this week ( 24 & 19 ) the judge granted it , but not back when they turned 18, and set the order @ $400 a month, still leaving me not enough to live on , but supplying my ex with her booze to stay drunk on, it was a phone court since she lives in another state, the judge hated me right off talking mean to me for being disabled , and the whole time being sweet to my ex on the phone , goes to show you ..women rule the world,, .The judge never ask me for my reciepts or anything , I just kept my mouth shut fearing his mean tempered mouth on me , and he don't have have clue about my ex. We need a revolution on the laws this goverment has .If I had the $ I would go live in a new country cause this 1 sucks