I pay 28% of my net income for child support to my ex wife here in the state of Illinois. Our divorce decree says nothing about how much I can deduct for 401k contributions. I currently contribute 5% since my company matches my contribution.
My ex wife is furious that I am making contributions because she says it reduces the amount that I pay her. She wants me to pay her the difference from the last 3 years which is thousands of dollars. Am I obligated to pay her this money?
The Illinois calculation of “net income” does NOT include your IRA contribution. If the child support calculation used your income as “net of IRA contribution” then she might be able to modify it today, but she cannot go back in time and capture that money. It was her responsibility to calculate it correctly in the first place.
Erik H. Carter is a Senior Attorney of the Cordell & Cordell, P.C. office in Indianapolis, Indiana as well as the Litigation Manager of both the Indianapolis and Pittsburgh offices. Mr. Carter has practiced since 1993 as an attorney. He is licensed in Illinois, Indiana, Pennsylvania as well as the Northern District of Indiana and the Southern District of Indiana.