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Office of Child Support Enforcement - 70% of Debt Owed by Those Earning Under $10k



 
 
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  #1  
Old March 4th 09, 08:19 AM posted to alt.child-support
Dusty
external usenet poster
 
Posts: 340
Default Office of Child Support Enforcement - 70% of Debt Owed by Those Earning Under $10k

http://mensnewsdaily.com/glennsacks/...ing-under-10k/

Office of Child Support Enforcement - 70% of Debt Owed by Those Earning Under $10k
Robert Franklin, Esq.
2009-03-03

This 2004 study by the Office of Child Support Enforcement shows that, according to their figures, 63% of all people who are behind on their child support report earning less than $10,000 per year. That accounts for 70% of all the child support owed in this country. The same figures show that 34% of child support obligors report earning no money at all during the year.

Of course those are reported earnings, and no one thinks that all those people report everything they earn. That would be as foolish as assuming that the child support system records everything they pay, which it doesn't. A lot of non-custodial parents make payments in cash or as gifts which don't get recorded by "the system." Sanford Braver's study in Maricopa (AZ) County found that only 43% of child support was made to the clerk of the court and thus officially recorded.

Still, it doesn't take much imagination to understand that, overwhelmingly, the people who owe the money don't have it to give. To say that the majority of the people who are behind on their payments are fathers is to state the obvious. Given that 84% of non-custodial parents are fathers, how could it be otherwise?

An interesting aspect of the report is this quotation: "The best way to reduce the total national child support debt is to avoid accumulating arrears in the first place. The best ways to avoid the accumulation of arrears are to set appropriate orders initially, modify orders via simple procedures promptly when family circumstances change and immediately intervene when current support is not paid (emphasis mine)."

Are states listening? I doubt it, but in case they are, let me say what I've said before - family courts need to establish quick, summary ways to adjust child support payments "when family circumstances change." When a non-custodial parent loses a job, has a health crisis or for some other legitimate reason is unable to earn the income on which child support was originally established, there should be an easy way for him/her to appear in court without an attorney, but with the custodial parent on notice, and explain facts to the judge.

Courts could appoint special child support modification masters whose job it would be to hear those cases. The evidence required to obtain a modification could be published and standardized - letters from doctors, employers, etc. should be sufficient. No attorney would be necessary and the rules of evidence relaxed. Testimony would be under oath. False testimony would be punished.

Sanford Braver found that, when obligors who had lost their job were removed from the database, between 80% and 100% of child support was paid in full and on time. So the obvious solution to child support arrearages is as the OCSE says, to make it easy, quick and cheap to get those orders modified when circumstances warrant.
----------------------------------------------
The following is the 2004 report as mentioned above...




The Story Bhind the Numbers
Who Owes the Child Support Debt?

States report that over $90 billion has accumulated in unpaid child support since the inception of the federal child support program in 1975. As of April 2003, over $70 billion was certified by states for the Federal Offset Program. This debt was owed by 5 million debtors in 6.7 million child support cases. The following analysis focuses only on the certified debt.

OCSE wants to know how much of this debt can reasonably be expected to be paid. OCSE did a data match comparing the debtors from the Federal Offset File* with the Quarterly Wage Files**. Here is what we found:

Most child support debtors report little or no earnings.
o 63% of the debtors, holding 70% of the $70 billion debt, had reported earnings of less than $10,000.
o 29% had reported earnings between $1 and $10,000.
o 34% had no reported earnings.

Why do 1/3 of debtors have no reported earnings?

Does this mean they had no income? Not necessarily.
o Not all earnings are reported to state Quarterly Wage files.
o Only wages for "covered" employment (i.e., employment subject to the state Unemployment Insurance Tax) are required to be reported. For example, earnings for the self-employed and independent contractors are not covered.
o Federal and military employment are not reported to state Quarterly Wage files. However, these were included in this match done by OCSE.
o Some earnings that should be reported by employers are not.
o Earnings from illegal activities or those being paid "under the table" are not reported.

Why should we be concerned about debtors with no reported earnings? Because they represent 34% of the debtors and owe over 42% of the certified debt.

OCSE did matches of this group with other databases. Here is what we found:

What do we know about these debtors with no reported earnings?
Matches of this group with other databases indicate that:
o 10 % have bank accounts. The value of these accounts is in excess of $1 billion.
o Over 11,000 debtors had accounts in excess of $10,000.
o A significant number were receiving federal benefits, such as Social Security and Unemployment Insurance benefits, which are attachable to pay child support.
o Some appeared in the National Directory of New Hires, indicating new employment.
o For others, a Federal tax refund offset to pay child support occurred.
o Others were incarcerated.

What does this tell us? While it appears that most child support debt is owed by persons with little or no income, does that mean we should forget about collecting on that debt? No. Further analysis indicates that there are untapped resources available to pay some of this child support debt. Child support enforcement agencies have to systematically utilize tools other than wage withholding to enforce these orders. The purpose of debt analysis isn't to justify writing off debt; it is about being smarter to get debt paid.

Arrears Management
The best way to reduce the total national child support debt is to avoid accumulating arrears in the first place. The best ways to avoid the accumulation of arrears are to set appropriate orders initially, modify orders via simple procedures promptly when family circumstances change, and immediately intervene when current support is not paid. Parents should share in the cost of supporting their children according to their ability. Designing a system that establishes appropriate orders will encourage payment of child support.

And what do we do about people who have accumulated large debts, but clearly are unable to pay these extremely large debts? In FY 2003, we only collected 58% of current support due. Preliminary data from one state indicate that only about 30% of non-custodial parents with orders make a payment consistently each month. Also, we know that about 50% of the debt is owed to the government. We need to be more creative in finding ways to leverage the old government debt in order to encourage the payment of current support. We need to find a way to do this that avoids sending the message that obligors can ignore support obligations because of the possibility that the state may eventually accept less than the full amount owed. This may mean targeting certain groups of debtors who are low-income and are most likely to accumulate the debt, for interest amnesty or debt compromise programs. We want child support to be a reliable source of income for children.

U.S. Department of Health and Human Services
Administration for Children and Families
Office of Child Support Enforcement http://www.acf.dhhs.gov/programs/cse/


*Federal Offset File: The Federal Offset Program assists states with collection of child support debt by enforcing four remedies. States submit cases with child support debt that meet certain minimum requirements.

**Quarterly Wage File: Employers report wages that were paid to an employee during the quarter, to the state agency, as required by state law. Federal agencies and each state collect quarterly wage data and forward this information to the National Directory of New Hires.
  #2  
Old March 5th 09, 04:33 PM posted to alt.child-support,alt.politics.economics,alt.politics.usa.constitution
DB[_4_]
external usenet poster
 
Posts: 266
Default Office of Child Support Enforcement - 70% of Debt Owed by Those Earning Under $10k

I'm cross posting this as everyone is effected by laws that hurt all families and should be made aware of them.
The politicians who support this insane system and have built their careers on this platform should be removed as they are not acting in the best interest of the people.


"Dusty" wrote in message ...
http://mensnewsdaily.com/glennsacks/...ing-under-10k/

Office of Child Support Enforcement - 70% of Debt Owed by Those Earning Under $10k
Robert Franklin, Esq.
2009-03-03

This 2004 study by the Office of Child Support Enforcement shows that, according to their figures, 63% of all people who are behind on their child support report earning less than $10,000 per year. That accounts for 70% of all the child support owed in this country. The same figures show that 34% of child support obligors report earning no money at all during the year.

Of course those are reported earnings, and no one thinks that all those people report everything they earn. That would be as foolish as assuming that the child support system records everything they pay, which it doesn't. A lot of non-custodial parents make payments in cash or as gifts which don't get recorded by "the system." Sanford Braver's study in Maricopa (AZ) County found that only 43% of child support was made to the clerk of the court and thus officially recorded.

Still, it doesn't take much imagination to understand that, overwhelmingly, the people who owe the money don't have it to give. To say that the majority of the people who are behind on their payments are fathers is to state the obvious. Given that 84% of non-custodial parents are fathers, how could it be otherwise?

An interesting aspect of the report is this quotation: "The best way to reduce the total national child support debt is to avoid accumulating arrears in the first place. The best ways to avoid the accumulation of arrears are to set appropriate orders initially, modify orders via simple procedures promptly when family circumstances change and immediately intervene when current support is not paid (emphasis mine)."

Are states listening? I doubt it, but in case they are, let me say what I've said before - family courts need to establish quick, summary ways to adjust child support payments "when family circumstances change." When a non-custodial parent loses a job, has a health crisis or for some other legitimate reason is unable to earn the income on which child support was originally established, there should be an easy way for him/her to appear in court without an attorney, but with the custodial parent on notice, and explain facts to the judge.

Courts could appoint special child support modification masters whose job it would be to hear those cases. The evidence required to obtain a modification could be published and standardized - letters from doctors, employers, etc. should be sufficient. No attorney would be necessary and the rules of evidence relaxed. Testimony would be under oath. False testimony would be punished.

Sanford Braver found that, when obligors who had lost their job were removed from the database, between 80% and 100% of child support was paid in full and on time. So the obvious solution to child support arrearages is as the OCSE says, to make it easy, quick and cheap to get those orders modified when circumstances warrant.
----------------------------------------------
The following is the 2004 report as mentioned above...




The Story Bhind the Numbers
Who Owes the Child Support Debt?

States report that over $90 billion has accumulated in unpaid child support since the inception of the federal child support program in 1975. As of April 2003, over $70 billion was certified by states for the Federal Offset Program. This debt was owed by 5 million debtors in 6.7 million child support cases. The following analysis focuses only on the certified debt.

OCSE wants to know how much of this debt can reasonably be expected to be paid. OCSE did a data match comparing the debtors from the Federal Offset File* with the Quarterly Wage Files**. Here is what we found:

Most child support debtors report little or no earnings.
o 63% of the debtors, holding 70% of the $70 billion debt, had reported earnings of less than $10,000.
o 29% had reported earnings between $1 and $10,000.
o 34% had no reported earnings.

Why do 1/3 of debtors have no reported earnings?

Does this mean they had no income? Not necessarily.
o Not all earnings are reported to state Quarterly Wage files.
o Only wages for "covered" employment (i.e., employment subject to the state Unemployment Insurance Tax) are required to be reported. For example, earnings for the self-employed and independent contractors are not covered.
o Federal and military employment are not reported to state Quarterly Wage files. However, these were included in this match done by OCSE.
o Some earnings that should be reported by employers are not.
o Earnings from illegal activities or those being paid "under the table" are not reported.

Why should we be concerned about debtors with no reported earnings? Because they represent 34% of the debtors and owe over 42% of the certified debt.

OCSE did matches of this group with other databases. Here is what we found:

What do we know about these debtors with no reported earnings?
Matches of this group with other databases indicate that:
o 10 % have bank accounts. The value of these accounts is in excess of $1 billion.
o Over 11,000 debtors had accounts in excess of $10,000.
o A significant number were receiving federal benefits, such as Social Security and Unemployment Insurance benefits, which are attachable to pay child support.
o Some appeared in the National Directory of New Hires, indicating new employment.
o For others, a Federal tax refund offset to pay child support occurred.
o Others were incarcerated.

What does this tell us? While it appears that most child support debt is owed by persons with little or no income, does that mean we should forget about collecting on that debt? No. Further analysis indicates that there are untapped resources available to pay some of this child support debt. Child support enforcement agencies have to systematically utilize tools other than wage withholding to enforce these orders. The purpose of debt analysis isn't to justify writing off debt; it is about being smarter to get debt paid.

Arrears Management
The best way to reduce the total national child support debt is to avoid accumulating arrears in the first place. The best ways to avoid the accumulation of arrears are to set appropriate orders initially, modify orders via simple procedures promptly when family circumstances change, and immediately intervene when current support is not paid. Parents should share in the cost of supporting their children according to their ability. Designing a system that establishes appropriate orders will encourage payment of child support.

And what do we do about people who have accumulated large debts, but clearly are unable to pay these extremely large debts? In FY 2003, we only collected 58% of current support due. Preliminary data from one state indicate that only about 30% of non-custodial parents with orders make a payment consistently each month. Also, we know that about 50% of the debt is owed to the government. We need to be more creative in finding ways to leverage the old government debt in order to encourage the payment of current support. We need to find a way to do this that avoids sending the message that obligors can ignore support obligations because of the possibility that the state may eventually accept less than the full amount owed. This may mean targeting certain groups of debtors who are low-income and are most likely to accumulate the debt, for interest amnesty or debt compromise programs. We want child support to be a reliable source of income for children.

U.S. Department of Health and Human Services
Administration for Children and Families
Office of Child Support Enforcement http://www.acf.dhhs.gov/programs/cse/


*Federal Offset File: The Federal Offset Program assists states with collection of child support debt by enforcing four remedies. States submit cases with child support debt that meet certain minimum requirements.

**Quarterly Wage File: Employers report wages that were paid to an employee during the quarter, to the state agency, as required by state law. Federal agencies and each state collect quarterly wage data and forward this information to the National Directory of New Hires.
 




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