Did You Know: …Divorce: Child Support: Differences bet. Arrears -vs- Past Support

Past (Child) Support:  a court-ordered obligation for a period of time that child support would have been owed prior to the establishment of the current child support order; Balances that are owed on past support do not accrue interest and are not considered “arrears” debts.  For example: John and Jane Doe are no longer living together.  John asks the Oneida County Child Support Agency to establish child support because Jane has left the house in July of 2012.  The Child Support Agency then schedules the matter for a hearing, having both parties served with the motion in August of 2012, with the hearing date in October of 2012.  During the October 2012 hearing date, the court orders a child support obligation for Jane starting 10/01/2012 at $200 per month.  The court then orders past child support for August and September because Jane Doe should have supported the children for those months as well…If the court does not order a payment amount on the $400 owed, the debt sits there until an order is entered on it, whether administratively or by an new order of the court.  If there is a repayment order on the “past support,” and if the payer does not make her payments, then that ordered amount becomes arrears and is subject to interest charges.

Arrears: is the accumulation of the current obligation amount not being paid by the payer.  If Jane Doe does not make her $200 October child support payment or her $50 past support payment, the Child Support Agency will roll-it-over into the “arrears” category…she would then owe $250 in arrears as of November 1st…if she did not make her November payments as well, then her arrears would be $500 as of December 1st PLUS (+) interest of 1% per month.  Jane Doe’s past support balance would be reduced by $100 and only the month  amount would roll over as arrears owed.

Legal Snippets from the Past: Oneida County Criminal Docket Entry (Pg. 122)

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These were definitely different times in Oneida County….The above docket entry reads as follows:

Nov. 4th, 1907.  Complaint for criminal warrant made in writing by Ernest Meicikalski charging that on the 31st day  of October 1907 at said County, Geo. Hafield did wrongfully and feloniously take, steal and carry away from the possession of the complainant, one turkey and one white leghorn cock, of the value  of three dollars, the property of this complainant, against the peace and dignity of the State of Wisconsin.  Complaint filed and warrant issued and delivered to Deputy J.M. Burns for service. D. H. Walker, Municipal Judge.

Legal Snippets: City of Rhinelander -vs- E. S. Shepard

The Result:

Aug. 28, 1907.  Warrant was returned having been served…Deft. in court in custody of Officer Sullivan…Complaint read. Deft. pleads “Guilty”…court imposes a fine of $15.00 and costs and in default of payment…that he be imprisoned in the common jail of Oneida County, for a period not to exceed twenty-one days.  Fine and costs paid and Deft. discharged.  F.M. Mason, J.P. acting Municipal Judge

Legal Snippets from the Past: 1907 Oneida County Criminal Docket (Page 71)….

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…the body of the above image reads:

State of Wisconsin, Oneida Co.  In Municipal Court. City of Rhinelander, Plaintiff, against E. S. Shepard, Defendant. Before F. M. Mason, J. P. & Acting Municipal Judge.  1907. Aug. 28th…Complaint for criminal warrant made in writing by M. Sullivan, charging that on the 27th day of August 1907, at said City, E.S. Shepard did as the deponent verily believes, violate an ordinance of said City, to-wit “An Ordinance to Maintain and Enforce Good Order in the City” which said Ordinance was duly published on the 17th day of May A.D. 1894 and was in force from said day until this date, in that he did then and there contrary to said ordinance  use boisterous and indecent  language on the streets of said City and was in a drunken and disorderly condition thereon.  Wherefore complaintant prays that said E.S. Shepard may be arrested and dealt with according to law.      Complaint filed and warrant issued and delivered to Officer Sullivan.                                       F. M. Mason, J.P. & Acting Municipal Judge

Seidl Law Offices, LLC, cannot verify that the “E. S. Shepard” in this Oneida County Criminal Docket entry is in fact thee Eugene Simeon Shepard (1854 -1923) who is credited for catching the infamous Rhinelander Hodag…the Eugene S. Shepard credited for capturing the Hodag would have been about  but 53 years old at the time of this 1907 Oneida County Criminal Docket Entry …In any event, assuming this E.S. Shepard plead “Guilty,” what do you think his sentence was?  Check back later for the result!!

DID YOU KNOW…Wisconsin Stats. Chapter 128 Debt Amortization: An Alternative to Bankruptcy

For those who are qualified wage earners residing in Wisconsin, Wisconsin law offers a very unique and attractive alternative to filing for bankruptcy relief under Chapters 7 and 13 of the U.S. Bankruptcy Code.  Chapter 128 debt amortization actions are not for everyone; however, for those individuals who do qualify, it offers a mechanism – which is considered to be a financial planning tool among practitioners – for getting your debt under control without the harsh effects on your credit score that a Federal Chapter 7 bankruptcy petition (and resulting discharge of debts) will bring.

Chapter 128 debt amortization under the Wisconsin Statutes is (compared to the other 995 Chapters in the Wisconsin Statutes) not a new law, however it is not well known (especially in the northern part of Wisconsin); yet it is unique compared to what is offered by other States and is an attractive alternative to those who qualify.  It wasn’t until the early 1990s that actions under §128.21, Wis. Stats., began gaining popularity by individual debtors in Wisconsin.  It is not bankruptcy, and it is not debt consolidation, but it is similar to both.

…THE NUTS AND BOLTS (SUMMARY):

  • With a §128.21 debt amortization petition, a debtor can consolidate only those debts he or she wants to manage.
  • Wis. Stats §128.21 Petitions are much less complex, far less expensive and far less invasive than filing for bankruptcy relief.
  • Late rents, utility bills, payday loans, credit card debts, speeding tickets, hospital bills, clinic bills, and other medical bills can all be included in a §128.21 debt amortization petition (not secured debts such as mortgages or car loans).
  • The Wis. Stats. §128.21procedure stops interest and late fees from accruing (being added to the total debt); EXAMPLE: if you include $15,000 of unsecured debt in the Petition, that amount is paid by you, in even monthly installments, over the course of up to 36 months (three years – the plans can be formulated to run for a shorter period of time, but only if it is feasible for the debtor) without the creditor being able to add interest or late charges or legal fees on top of the $15,000 you owe.
  • The procedure stops those creditors that are included in the Petition from garnisheeing wages or attaching assets, and stops utilities from cutting off power or heat.  The statute empowers your County Circuit Court  to appoint a Trustee to “administer” the debtors’ (your) estate and to issue a protective order that forces most types of creditors to accept payments of debts owed to them over the course of up to 36 months, despite the fact that those creditors may have a contract with you, the debtor, whose terms and conditions would normally dictate otherwise (the statute trumps private contracts between you and the creditor which are amenable to Wisconsin state-court jurisdiction).  By operation of this unique law, a §128.21 Petition stops interest from being added to your credit card debts and other similar debts that are included in the Petition.  Upon filing the Petition, the statute provides that any creditors named by the debtor who are amenable to the Courts’ jurisdiction, no matter where such creditors are located, are automatically prohibited from attempting or continuing to attach the debtor’s property or garnish his or her wages.  An interim order that is signed by the Judge after the filing of the Petition prohibits those listed creditors from trying to collect on their debts.  However, creditors are not prohibited from obtaining judgments or litigating judgments on included debts (but they are not able to collect on the debts pending the debtor’s §128.21 proceedings).
  • All of the debtor’s property is exempt from attachment.
  • Credit counseling courses and debtor education courses are not required, as compared to a Chapter 7 bankruptcy action.
  • You do NOT have to submit Tax Returns or anything similar to the Schedules required in a Chapter 7 bankruptcy Petition.  You do have to list the debts you wish to include, along with the names of the creditors, the total amount owed to each creditor; and you are required to sign the Petition in good faith and under oath while asserting that, after consideration of you total financial position, you will be able to and intend to make the regular, monthly payments to the Trustee for the benefit of those creditors who are included in your Petition.
  • There is no “Means Test” that you have to satisfy, but again, you do have to sign the Petition in good faith asserting that your financial position will allow you to make the regular monthly payments consistent with the 128 plan.
  • The Petitions are submitted by mail, and very rarely is there a requirement for hearings or trials or actual presence in court.
  • The filing fee is much, much less compared to filing a Chapter 7 Petition under the Federal Bankruptcy Code [Currently $306 Filing Fee for a Chapter 7 bankruptcy Petitioner versus a $31.50 Filing Fee for a Wisconsin §128.21 Debt Amortization Petition].
  • If you hire an attorney to assist you, the attorney fees are also much, much less than they are compared to the attorney fees for a Chapter 7 Petition.
  • A §128.21 Petition and plan usually will not have the drastic, negative effect on your credit score that a Federal Chapter 7 bankruptcy Petition and resulting discharge of debts will have.
  • You DO end up paying back the debt(s) included in the §128.21 plan – over the course of three years (36 months) – but those creditors included in the Petition are prohibited from adding any additional interest charges or late fees or penalties.
  • The Court appoints a Trustee to whom you make monthly payments towards the debts of creditors included in the Petition; the Trustee receives your payments and disburses the payments to the creditors named in your Petition on a regular, monthly or quarterly basis.
  • The Trustee is paid  by you in one of two ways:
    • If you choose to have the monthly payments come out of your paycheck via your employer, the Trustee may charge you up to 7% of the amount you send to him or her.
    • If you choose to send the Trustee the monthly payments yourself –without involving your employer – the Trustee may charge you up to 10% of the amounts you send to him or her
    • Creditors are allowed to object to the Trustee’s plan, but rarely do.

 For more information on §128.21 Petitions and Chapter 7 bankruptcy actions, please contact Seidl Law Offices, LLC at (715)365-9008.

DID YOU KNOW… [Courtesy of WI JUDICARE, Inc., LOW-INCOME TAXPAYER CLINIC (LITC)]

…Wisconsin Judicare, Inc., provides a service called the “Low-Income Taxpayer Clinic (LITC) to assist low and moderate income families with tax controversies?

Yes; Wisconsin Judicare, Inc., a non-profit corporation, understands that the majority of taxpayers want to comply with tax laws, but may need help from tax professionals.  If you are a low income taxpayer*** who needs assistance in resolving tax disputes with the Internal Revenue Service (IRS) and you cannot afford representation, or if you speak English as a second language and need help understanding your taxpayer rights and responsibilities, you may qualify for help from a Low Income Taxpayer Clinic (LITC) that provides free or nominal costs assistance.

Low Income Taxpayer Clinics represent low income taxpayers before the IRS and assist taxpayers in audits, appeals and collection disputes.  LITCs can also help taxpayers respond to IRS notices and correct account problems.

Although Low-Income Taxpayer Clinics receive partial funding from the IRS, LITCs, their employees, and their volunteers are completely independent of the federal government.  These clinics are operated by nonprofit organizations or academic institutions.  This is not a recommendation by the IRS that you retain the services of a LITC or other similar organization to represent you before the IRS.  Each clinic independently decides if you meet the income eligibility guidelines and other criteria before it agrees to represent and assist you.

Wisconsin Judicare’s Low-Income Taxpayer Clinic may be able to help with the following:

  • Claiming Earned Income Tax Credits\
  • Audits/Exams
  • Innocent Spouse Declarations
  • Offers-in-Compromise
  • Responding to Letters from the IRS

The attorneys, for the most part, will not prepare tax returns.

 ELIGIBILITY ~ If you are a low-income taxpayer who cannot afford professional tax assistance during audits of your federal income tax return, you may qualify for help via Judicare’s Low-Income Taxpayer Clinic.  Using poverty guidelines published annually by the Department of Health and Human Services (HHS), each Low Income Taxpayer Clinic (LITC) decides if you meet the income eligibility guidelines and other criteria before it agrees to assist and/or represent you.  A controversy clinic receiving federal funding must have at least 90% of the taxpayers served with incomes that do not exceed 250% of the poverty guidelines.

BEFORE CALLING:  Have the following materials ready when contacting the Low-Income Taxpayer Clinic for the first time.  Questions may be answered more easily if these items are in your possession during your contact with the LITC:

  1. Any tax bills, letters from the IRS;
  2. Copies of letters written to the IRS;
  3. Your Social Security Number;
  4. Your current income.

Each year, changes in tax laws and forms add to the complexity of working with the IRS.  Many individuals need to file additional forms in order to get  Earned Income Credit and child tax credits due.

***For more information, including eligibility requirements, you may contact Wisconsin Judicare, Inc., using any of the following means: www.judicare.org OR  1-800-472-1638.

DISCLAIMER:  Seidl Law Offices, LLC, provides this content for informational purposes only and this article should not be construed as an endorsement of the entity referenced in this article.  Seidl Law Offices, LLC, their Managers, Members, Officers, Associates, and Employees make no representation, warranty peomise or guarantee that the services offered by the entity referenced to in this article will be successful, and specifically disclaims any assertion that the services offered or the results obtained by such entity will be satisfactory to users.  In particular, Seidl Law Offices, LLC, their Managers, Members, Officers, Associates, and Employees provide the within content for informational purposes only and further do not warrant, guarantee or promise that the entity or entities which is (are) the subject of this article: (a) is bonded, if required; (b) is licensed, if required; (c) has a history of success in its asserted field of expertise; (d) carries liability insurance; or (e) has the necessary qualifications to engage in such activity as the entity referenced asserts that it may have.  All persons and entities that choose to pursue and/or retain the services of the entity referenced in this article are strongly advised to independently seek further information from the entity itself, from the State of Wisconsin, from the Federal government and from independent legal counsel concerning the issues of whether the entity: (a) is bonded, if required; (b) is licensed, if required; (c) has a history of success in its asserted field of expertise; (d) carries liability insurance; and (e) has the necessary qualifications to engage in such activity as the entity referenced asserts that it may have.  Seidl Law Offices, LLC, has no legal property interest or ownership interest in the legal entity that is referenced in this article.  Similarly, the legal entity referenced in this article has no legal property interest or ownership interest Seidl Law Offices, LLC.