Jack has been paying child and spousal support to Jill for
over a year now, pursuant to a temporary agreement reached between them in
mediation based on what they anticipated to earn in 2013. Jack recently completed his 2013 income tax
return, which confirms that his actual income for that year was higher than he had
anticipated. He wonders whether he has
an obligation to tell Jill about his higher income. The last thing he wants is for her to find
out that he is making more money and, as a result, that he needs to increase
the monthly support payments he is making!
Normally, final separation agreements (or court orders)
which contain child support obligations will provide that parties have to
exchange their income information each year.
This is because the law (Child Support Guidelines) specifically says
that child support may be varied each year to reflect any changes in the
parents’ income. The change does not
have to be important: as a payor’s income fluctuates, so does his or her child
support obligation. Thus, the importance for parents to exchange income
information each year.
This is not necessarily the case for spousal support. Usually, an ex-spouse’s obligation to pay
spousal support is based on the income that the parties earned at the time of
their separation. To subsequently vary a
spousal support agreement or court order, the person requesting the change must show that there has been a “material
change in either party’s circumstances” since the making of the agreement or
court order. A significant change in
one’s income may (and I say “may”) justify a change in spousal support. Other circumstances
justifying a variation of spousal support could include a payor’s retirement; the
support recipient moving in with a new spouse; the termination of a child
support obligation; a change in employment for either party; or any other such
change affecting either parties’ financial situation. Since there is no inherent right to vary
spousal support each year, there is normally no positive obligation imposed on
the ex-spouses to exchange their income information yearly. However, the ex-spouses have an obligation to
disclose any “material change in one’s circumstances” when it arises. As
always, if the parties cannot agree on the new support amount, they will need
to seek the variance through a court order.
