Child Support Payments through a Trust instead of Child Support Clearinghouse – Do I have a choice?
A Trust for the Child
As an alternative to child support payments, it is possible to set up a trust fund for your child. If the court considers this controlling, it could result in penalties or other consequences. The judge may approve the creation and use of a trust fund for child support. However, the noncustodial parent can seek legal advice to help them make the best decisions and file the case appropriately. It is more complicated to create a trust than simply transfer money each month to one spouse.
The estate planner should consider trusts as a tool. If the beneficiary is not prepared for it, trusts can be a source of income. There are many types of trusts. Some pay beneficiaries monthly, while others hold funds for a longer period. You can roll over funds to other investments or to an account to keep the money until it is time to disburse. A trust creator will need to discuss his or her plans and needs with an estate planning attorney.
The Choice and the Divorce Process
The judge will generally decide how many children support the noncustodial spouse will pay to the ex-spouse in divorce cases. Once the matter is settled, the type and amount of payments will be set up. The judge will then decide how many children support the noncustodial parent will transfer to the ex-spouse during the divorce case. If the estate is substantial enough, others may only pay a portion of the child support payments.
Others with better estate plans and better planning may be able to provide a better solution for the child. They can direct the funds to the child without any interference from the custodial parent.
The court will approve the trust, as well as the estate. It is up to the court to decide if a trust or another method is best for the child. If the custodial parent has an addiction, is unable to manage their finances well, or has a gambling or drinking problem, trust could be the best option. A trust can be used to provide for the youth after he/she turns 18. It also allows the trust to pay the beneficiary to help ensure that college, housing, or large property options are available to him/her. These estate planning options are usually available when they are approved by the judge or through an agreement between both parents.
Modifications to the Original Judgment
The court may grant a modification if the noncustodial parent doesn’t have the financial resources or the ability to set up and use a trust. This will depend on whether the custodial parent can create and use a trust before the divorce is finalized. If the noncustodial parent provides spousal support or monetary child benefits, the judge might approve to provide financial support for the youth in the future. The current circumstances of both families will play a role in determining the outcome.
Legal Support and Trust
Garnishments can be used by parents to support their children. This could be to either push the income into trusts or to pay child support. A trust can be used to provide income for the youth or help them pay their bills each month. The parent might need to get a lawyer to present the case and implement this alternative to child support.
Trusts are often considered income. Once the child can receive the funds, they may need assistance to manage it. The noncustodial parent might need to hire a family law surrey bc to help him or her at this time as well as to create trust.