SB105: Bill Text

LRB-1817/1

SWB&EAW:cdc

2021 - 2022 LEGISLATURE

2021 Senate BILL 105

February 11, 2021 - Introduced by Senators Jacque and Ballweg, cosponsored by Representatives Brooks, Brandtjen, Bowen, Dittrich, Gundrum, Moses, Mursau, Skowronski, Tusler and Wichgers. Referred to Committee on Human Services, Children and Families.

SB105,1,5 An Act to repeal 767.225 (1) (e); and to amend 565.30 (5m) (a), 767.34 (1), 767.35 (1) (c), 767.511 (6m), 767.531 (intro.), 767.54, 767.553 (1) (a), 767.59 (1), 767.61 (3) (i), 767.71 (1) (a), 767.73 (1) (a), 767.75 (1) (b), 767.77 (1) and 767.78 (1) of the statutes; relating to: calculating the child support obligation and elimination of family support.

Analysis by the Legislative Reference Bureau

This bill reorganizes certain aspects of the Department of Children and Families administrative rules relating to commonly used child support formulas in order to reflect current practices. The manner of calculating the amount of child support and the applicable formulas are not changed in the bill. The bill also makes statutory changes to eliminate future family support orders.

Under current DCF rules, the child support formula that applies in a shared physical placement arrangement is included among the formula for “special circumstances.” The bill moves the formula that applies in a shared physical placement arrangement to a new section of DCF's rules before all of the child support formula variations. The bill also specifies that, under DCF rules, the designated percentage that applies in a nonshared physical placement arrangement applies only if the conditions for the shared placement formula do not apply.

The bill creates a new defined term under the DCF rules for a “designated percentage,” to mean the applicable percentage of a parent's monthly income, or adjusted monthly income, that is available for child support. The “designated percentage” phrase is then used within the calculations for a shared-placement arrangement and circumstances of a serial-family parent, split-placement parents, and combinations of special circumstances.

The bill retitles the applicable DCF administrative code chapter from “Child Support Percentage of Income Standard” to “Child Support Standard.” The bill also removes the definition of the term “standard” or “percentage standard” from DCF's rules and moves a Note appended to the definition of “standard” in the DCF rules to the new definition of the “designated percentage.” The Note specifies that the standard is based on national studies and is adjusted downward to reflect costs incurred by a parent when a child is in the parent's care and costs to maintain a child's health insurance.

The bill moves the listing of the designated percentage amounts, and the standard that applies to a request for a deviation from the percentage standard, to be placed with and follow the shared physical placement arrangement formula under DCF's rules. The new section is titled, “Determining the child support obligation.” The bill also updates cross-references within the DCF rules to reflect the reorganization of the shared physical placement and designated percentage provisions.

In addition to the administrative code changes, the bill also changes the statutes to eliminate family support orders, providing that no new family support orders may be issued beginning on the bill's effective date. Family support orders issued before the bill's effective date would remain in effect and be subject to all provisions in current law that apply to family support orders, including provisions relating to calculating interest and the duties of DCF regarding application of payments received.

Under current law, family support is an alternative that combines the component parts of child support and maintenance in a single obligation, and is based upon the same criteria that apply to orders for child support and maintenance. Family support payments are treated as maintenance payments for federal and state tax purposes, so that the family support payment amount is deductible to the payor-spouse, and taxable to the recipient-spouse. However, under s. 11051 of the federal Tax Cuts and Jobs Act of 2017, maintenance payments are no longer deductible by the payor-spouse and are not included in income to the recipient-spouse. This change applies to any divorce or separation instrument executed after December 31, 2018. Divorce and separation instruments modified after the December 31, 2018, effective date are subject to prior law unless the modification expressly provides that the modified agreement be governed by the new law.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

SB105,1 Section 1. 565.30 (5m) (a) of the statutes is amended to read:

SB105,3,14 565.30 (5m) (a) The administrator shall report to the department of children and families the name, address, and social security number of each winner of a lottery prize that is payable in installments and the name, address, and social security number or federal income tax number of the person who has been assigned a lottery prize that is payable in installments. Upon receipt of the report, the department of children and families shall certify to the administrator whether any payee or assignee named in the report is obligated to provide child support, spousal support, maintenance, or family support under s. 767.531, 2019 stats., or s. 767.001 (1) (f) or (g), 767.225, 767.34, 767.511, 767.531, 767.56, 767.804 (3), 767.805 (4), 767.85, 767.863 (3), 767.89 (3), 767.893 (2m), or 948.22 (7) or ch. 769 and the amount required to be withheld from the lottery prize under s. 767.75. Subject to par. (b), the administrator shall withhold the certified amount from each payment made to the winner or assignee and remit the certified amount to the department of children and families.

SB105,2 Section 2 . 767.225 (1) (e) of the statutes is repealed.

SB105,3 Section 3 . 767.34 (1) of the statutes is amended to read:

SB105,3,21 767.34 (1) Authority. The parties in an action for an annulment, divorce, or legal separation may, subject to the approval of the court, stipulate for a division of property, for maintenance payments, for the support of children, for periodic family support payments under s. 767.531, or for legal custody and physical placement, in case a divorce or legal separation is granted or a marriage annulled.

SB105,4 Section 4 . 767.35 (1) (c) of the statutes is amended to read:

SB105,4,2 767.35 (1) (c) To the extent that it has jurisdiction to do so, the court has considered and approved or made provision for legal custody and physical placement, the support of any child of the marriage entitled to support, the maintenance of either spouse, the support of the family under s. 767.531, and the disposition of property.

SB105,5 Section 5 . 767.511 (6m) of the statutes is amended to read:

SB105,4,10 767.511 (6m) Pilot program on interest rate. The department may conduct a pilot program under which the interest that accrues on the amounts in arrears specified in sub. (6) and in s. 767.531, 2019 stats., and in sub. (6) shall be at the rate of 0.5 percent per month instead of 1 percent per month. If the department conducts a pilot program under this subsection, the program may begin at any time after December 31, 2013, and the new rate shall apply to interest that accrues during that time.

SB105,6 Section 6 . 767.531 (intro.) of the statutes is amended to read:

SB105,4,24 767.531 Family support. (intro.) The court may make a financial order designated “family support" as a substitute for child support orders under s. 767.511 and maintenance payment orders under s. 767.56. Subject to s. 767.511 (6m), a party ordered to pay family support under this section, 2019 stats., shall pay simple interest at the rate of 1 percent per month on any amount in arrears that is equal to or greater than the amount of child support due in one month. Subject to s. 767.511 (6m), if the party no longer has a current obligation to pay child support, interest at the rate of 1 percent per month shall accrue on the total amount of child support in arrears, if any. Interest under this section is in lieu of interest computed under s. 807.01 (4), 814.04 (4), or 815.05 (8) and is paid to the department or its designee under s. 767.57. Except as provided in s. 767.57 (1m), the department or its designee shall apply all payments received for family support ordered under this section, 2019 stats., as follows:

SB105,7 Section 7 . 767.54 of the statutes is amended to read:

SB105,5,10 767.54 Required exchange of financial information. In an action in which the court has ordered a party to pay child or family support under s. 767.225, 2019 stats., or s.767.531, 2019 stats., or child support under this chapter, including an action to revise a judgment or order under s. 767.59, the court shall require the parties annually to exchange financial information. Information disclosed under this section is subject to s. 767.127 (3). A party who fails to furnish information required by the court under this section may be proceeded against for contempt of court under ch. 785. If the court finds that a party has failed to furnish information required under this section, the court may award to the party bringing the action costs and, notwithstanding s. 814.04 (1), reasonable attorney fees.

SB105,8 Section 8 . 767.553 (1) (a) of the statutes is amended to read:

SB105,5,17 767.553 (1) (a) An order for child or family support under this chapter may provide for an annual adjustment in the amount to be paid based on a change in the payer's income if the amount of child or family support is expressed in the order as a fixed sum and based on the percentage standard established by the department under s. 49.22 (9). No adjustment may be made under this section unless the order provides for the adjustment.

SB105,9 Section 9 . 767.59 (1) of the statutes is amended to read:

SB105,5,24 767.59 (1) Definition. In this section, “support or maintenance order" means a judgment or order providing for child support under this chapter or s. 48.355 (2) (b) 4. or (4g) (a), 48.357 (5m) (a), 48.363 (2), 938.183 (4), 938.355 (2) (b) 4. or (4g) (a), 938.357 (5m) (a), 938.363 (2), or 948.22 (7), for maintenance payments under s. 767.56, for family support payments under this chapter s. 767.531, 2019 stats., or for the appointment of trustees or receivers under s. 767.57 (5).

SB105,10 Section 10 . 767.61 (3) (i) of the statutes is amended to read:

SB105,6,4 767.61 (3) (i) The amount and duration of an order under s. 767.56 granting maintenance payments to either party, any order for periodic family support payments under s. 767.531, 2019 stats., and whether the property division is in lieu of such payments.

SB105,11 Section 11 . 767.71 (1) (a) of the statutes is amended to read:

SB105,6,9 767.71 (1) (a) In this section, “support order" means an order for child support under this chapter or s. 948.22 (7), an order for family support under this chapter, 2019 stats., or a stipulation approved by the court for child support under this chapter.

SB105,12 Section 12. 767.73 (1) (a) of the statutes is amended to read:

SB105,6,15 767.73 (1) (a) In this subsection, “support payment" means a payment ordered for support under s. 767.521, support under s. 767.501, child support or family support under s. 767.225, family support under s. 767.531, 2019 stats., revised child or family support under s. 767.59, or child support under s. 767.511, 767.804 (3), 767.805 (4), 767.85, 767.863 (3), 767.89, or 948.22 (7) or ch. 769.

SB105,13 Section 13. 767.75 (1) (b) of the statutes is amended to read:

SB105,7,2 767.75 (1) (b) “Payment order" means an order for child support under this chapter, for maintenance payments under s. 767.225 or 767.56, for family support under this chapter, 2019 stats., for costs ordered under s. 767.804 (3), 767.805 (4), or 767.89 (3), for support by a spouse under s. 767.001 (1) (f), or for maintenance payments under s. 767.001 (1) (g); an order for or obligation to pay the annual receiving and disbursing fee under s. 767.57 (1e) (a); an order for a revision in a judgment or order with respect to child support, maintenance, or family support payments under s. 767.59; a stipulation approved by the court for child support under this chapter; and an order for child or spousal support entered under s. 948.22 (7).

SB105,14 Section 14. 767.77 (1) of the statutes is amended to read:

SB105,7,12 767.77 (1) Definition. In this section, “payment obligation" means an obligation to pay support under s. 48.355 (2) (b) 4. or (4g) (a), 48.357 (5m) (a), 48.363 (2), 938.183 (4), 938.355 (2) (b) 4. or (4g) (a), 938.357 (5m) (a), or 938.363 (2), support or maintenance under s. 767.501, child support, family support, or maintenance under s. 767.225, child support under s. 767.511, maintenance under s. 767.56, family support under s. 767.225, 2019 stats., or s. 767.531, 2019 stats., attorney fees under s. 767.241, child support or a child's health care expenses under s. 767.85, paternity obligations under s. 767.804 (3), 767.805 (4), 767.863 (3), or 767.89, support arrearages under s. 767.71, or child or spousal support under s. 948.22 (7).

SB105,15 Section 15. 767.78 (1) of the statutes is amended to read:

SB105,7,18 767.78 (1) Definition. In this section, “financial obligation" means an obligation for payment incurred under s. 767.531, 2019 stats., or s. 48.355 (2) (b) 4. or (4g) (a), 48.357 (5m) (a), 48.363 (2), 767.225, 767.241, 767.511, 767.531, 767.56, 767.61, 767.71, 767.804 (3), 767.805 (4), 767.85, 767.863 (3), 767.89, 938.183 (4), 938.355 (2) (b) 4. or (4g) (a), 938.357 (5m) (a), or 938.363 (2).

SB105,16 Section 16 . Chapter DCF 150 (title) of the administrative code is amended to read:

SB105,7,21 Chapter dcf 150

SB105,7,22 child support percentage of

SB105,7,23 income standard

SB105,17 Section 17 . DCF 150.02 (9m) of the administrative code is created to read:

SB105,8,3 DCF 150.02 (9m) “Designated percentage” means the applicable percentage of a parent's monthly income available for child support or adjusted monthly income available for child support under s. DCF 150.035 (2) or 150.04 (4) or (5).

SB105,18 Section 18 . DCF 150.02 (19) of the administrative code is amended to read:

SB105,8,10 DCF 150.02 (19) “Low-income payer" means a payer for whom the court uses the monthly support amount provided in the schedule in Appendix C based on the court's determination that the payer's total economic circumstances limit his or her ability to pay support at the level provided under s. DCF 150.03 (1) 150.035 and the payer's income available for child support is at a level set forth in the schedule in Appendix C.

SB105,19 Section 19 . DCF 150.02 (26) of the administrative code is amended to read:

SB105,8,14 DCF 150.02 (26) “Shared-placement payer" means the shared-placement parent who is determined to owe a greater support amount than the other parent under the calculation in s. DCF 150.04 (2) (b) 150.035 (1).

SB105,20 Section 20 . DCF 150.02 (28) of the administrative code is repealed.

SB105,21 Section 21 . DCF 150.02 (28) Note of the administrative code is renumbered DCF 150.02 (9m) Note.

SB105,22 Section 22 . DCF 150.03 (1) (intro.) of the administrative code is renumbered DCF 150.03 (1) and amended to read:

SB105,9,4 DCF 150.03 (1) Determining income available for child support using the percentage standard. The court shall determine a parent's monthly income available for child support by adding together the parent's annual gross income or, if applicable, the parent's annual income modified for business expenses; the parent's annual income imputed based on earning capacity; and the parent's annual income imputed from assets, and dividing that total by 12. This may be done by completing the worksheet in Appendix B, although use of the worksheet for this purpose is not required. Except as provided in s. DCF 150.04 (4) and (5), the percentage of the parent's monthly income available for child support or adjusted monthly income available for child support that constitutes the child support obligation shall be:

SB105,23 Section 23 . DCF 150.03 (1) (a) to (e) of the administrative code are renumbered DCF 150.035 (2) (a) to (e).

SB105,24 Section 24 . DCF 150.03 (1) (e) Note of the administrative code is renumbered DCF 150.035 (2) (e) Note.

SB105,25 Section 25 . DCF 150.03 (5) (a) of the administrative code is amended to read:

SB105,9,17 DCF 150.03 (5) (a) The court may consider a child's benefit under 42 USC 402 (d) based on a parent's entitlement to federal disability or old-age insurance benefits under 42 USC 401 to 433 and adjust a payer's child support obligation by subtracting the amount of the child's benefit received by the payee. In no case may this adjustment require the payee to reimburse the payer for any portion of the child's benefit. If the payer is receiving the child's benefit, the support amount is either the designated percentage standard applied to the payer's income or the amount of the child's benefit, whichever is greater.

SB105,26 Section 26 . DCF 150.03 (5) (b) (intro.), 2. and 7. of the administrative code are amended to read:

SB105,9,25 DCF 150.03 (5) (b) (intro.) If the shared-placement guidelines under s. DCF 150.04 (2) 150.035 (1) apply, the child's benefit is split between the parents in proportion to the amount of time the child spends with each parent. Add the proportion of the child's benefit that represents the proportion of time the child spends with the parent not receiving the benefit to the support obligation of the parent who is receiving the child's benefit. Support shall be determined as follows: