MLG LAW GROUP-CHICAGO DIVORCE AND CUSTODY LAWYERS

On July 28, 2017, the Illinois General Assembly passed  House Bill 2537 , which, if signed by Governor Rauner, will change the way maintenance payments in divorce work in Illinois.   HB 2537 proposes to modify Section 504 of the Illinois Marriage and Dissolution of Marriage Act (750 ILCS 5/504), which deals with Illinois spousal maintenance payments, also known as alimony.  This is expected to be signed into law and to go into effect in either January or July of 2018.  For additional knowledge about how maintenance works in Illinois, you can check out our article,  Illinois Spousal Maintenance Explained . According to the existing law, which went into effect in 2015, Illinois family law courts are instructed to weigh several factors to determine whether maintenance is appropriate.  If the court determines that maintenance is appropriate, the court will typically use statutory formulas to determine how much to award in maintenance and for how long the maintenance payments will con

The child support component of payments is not a taxable event. If someone receives a certain amount of money in child support, they do not declare that as income nor does the party who paid the child support claim it as a deduction for either federal or state tax purposes in Illinois. Maintenance, however – spousal support is what we used to call alimony – is a taxable event. There are some little wrinkles that the IRS has set up over the years to try to make sure that if money is changing hands and being called alimony, that it really is alimony. Assuming that those fairly simple tasks are met, the person who pays it takes that amount of money as a deduction right off the bottom of the front page of their federal tax returns. It comes right off the gross income. The party who receives it, it gets treated as ordinary income, so they pay tax on it. In general, maintenance is a taxable event, child support is not. MLG LAW GROUP 79 W Monroe Suite 925 Chicago, IL. 60603 312-37

New Illinois Child Support Law Taking Effect in 2017 Under present law, child support is based on the net income of the  child support  payer. It is 20% for one child, 28% for two, 32% for three, and 40% for four. Net income is defined in 750 ILCS 5/505 as gross income minus certain specified deductions. One of the factors is NOT the amount of parenting time that each parent has with the child. However, there are a few Illinois Appellate Court Opinions that say that parenting time may be considered. In the fall of 2016, the Illinois Legislature passed and the Governor signed a new statute that completely changes the way child support is calculated in Illinois. The new law takes effect July 1, 2017. The law eliminates the former percentages and creates what is called the income shared approach. “To calculate child support based upon the parent’s combined adjusted net income estimated to have been allocated to the child if the parents and children were living in an intact ho