Child Support Debt Reduction Program
The Debt Reduction Program provides eligible parents with past-due child support payments the opportunity to reduce the amount they owe to the government. “Arrears” are owed to the government if your dependent children received public assistance or were in foster care while you were not paying court-ordered child support. Federal and state law require that you reimburse the state for supporting your children during that time. If you qualify, you will be able to offer a compromise repayment to the state. In other words, you may offer to reduce the debt by paying an amount that is less than the full amount you owe. Any reduction in your arrears and interest owed will be based on your income and assets.
Any debt reduction agreement must take into consideration the needs of the children named in the child support order and the parent’s ability to pay.
Qualifying for the Debt Reduction Program:
- To qualify, you must be able to pay both your current child support obligation AND an ongoing debt payment.
- Your current income, assets, and expenses are considered.
- If the government determines that you are not able to pay off the total debt within twelve months, you may qualify for the debt reduction program, but this is reviewed in a case by cases basis.
As of May 2021, the debt reduction program requirements have changed. If you applied in the prior to May 2021 and was denied, you should apply again as you may qualify under the new program. If you qualify for the debt reduction agreement, the key factors are the needs of the children named in the child support order and the parent’s ability to pay.
What the Debt Reduction Program Won’t Do:
- It will not forgive the entire debt.
- It does not change your monthly child support obligations.
- It will not reduce unpaid child support that is owed directly to the person receiving support (also known as non-aid arrears).
- If your children never received public assistance or were never in foster care, you are not eligible.
- It will also not reduce spousal support arrears if the child support department as part of court order for child support or family support.
Do not stop paying your child support because you are applying for the Debt Reduction Program. Nonpayment could be used as a reason for denial of your application. Provide complete information and documents with your application. Your application cannot be considered until you have done this. Do not hide information and be truthful with your income and assets since if the government “finds out,” your application will not be granted. Make timely payments if you are granted debt reduction payments. If you fail to make the payments, the agreement will be revoked.
The process can be complex, and the documentation requirements could be confusing and burdensome. Having someone guide you and provide all the necessary information is critical to ensure your application is granted. Keep in mind, the legal interest is 10% and the arrears continue to increase. In fact, I have dealt with cases in which the interest is significantly more than the principal. Dealing with it now will save you a lot of money and enforcement tactics by the government can be stopped. Call my office at 310-601-7144 or email me at [email protected] so this debt can be dealt with immediately.
To receive updates on legal advice, please like my Facebook Page: https://www.facebook.com/attycarinacastaneda/ or follow me on Twitter: @AttyCastaneda and Instagram: @atty.castaneda.