Warren Sapp, a current analyst on NFL Network and former Buccaneer and Raider has filed for bankruptcy. He filed for Chapter 7, which is the liquidation one, not the one where you set up a payment plan. I don't do bankruptcy (too much math) so I cannot get into the ins and outs of the filing. But one thing is interesting, he owes the IRS approximately $900,000. He also owes --- wait for it -- child support in the "hundreds of thousands of dollars" according to the PFT article. Interesting.
You see, child support is not dischargeable in bankruptcy. That means, you can't sell your assets, pay what you can on your child support and forget about it. Child support is for the support of the child. If it could be discharged in bankruptcy, every person who owes child support would just file for bankruptcy. Then be free forever from paying it. Or at least the arrears. It would be against public policy to let the person get away with it.
Here is what I really don't get. Sapp has rought $6.45 in assets and only $6.75 in debts. He also currently has a job (the contract expires in August 2012). All of this is according to PFT. Why is he filing bankruptcy? Most of his debt is not dischargable in bankruptcy anyway, so he will still owe the money. Why not work out the other debts and move forward? Why not control your spending? (note to Sapp, you are not making millions as an athlete anymore). I just don't see how a liquidation bankruptcy really helps him in the long run.
Especially as he will still owe the child support. If the kids are young enough, the child support obligation will be ongoing (child support ends at 18 in Maryland, generally, no college payments required). So, if he doesn't get his spending under control, he will be right back in debt.
Child support does not go away.
Showing posts with label buccaneers. Show all posts
Showing posts with label buccaneers. Show all posts
Friday, April 6, 2012
Tuesday, June 14, 2011
What's Old is New -- Athletes and Child Support
While researching what expenses should be considered when calculating child support, I ran across this case:
Jackson v. Proctor
Seems Mr. Jackson and Ms. Proctor were the proud parents of a little girl. Well, Ms. Proctor was proud. Dad was trying to cheapskate the child support. Mom was a full time student. Dad played for the Tampa Bay Buccaneers. At the time of the filing for child support in 1997, Dad was making 18K a month. The final order required him to pay $2500 a month in child support*. He complained that was too much and was unfair.
Let's do the math. 18,000 - 2500 = 15500. In Maryland (yay, a case in the state where I am licensed) child support is calculated before taxes. Even taking out taxes, that leaves a lot left over for living expenses -- providing you aren't buying a lot of bling or big houses and cars. $2500 is a mere 13% of the Dad's monthly income.
This is what we love to call an "above the guidelines" case. The Guidelines are the chart of basic child support that the wise legislators in Annapolis decided was necessary to care for a child. It's a simple chart. You have income down one side (both parent's combined income since both parents are presumed to contribute to their child's support) and the number of children across the top. You figure the combined income, then go to the chart and find where the income cross the number of children. That's the basic child support amount. In 2010, the legislature finally updated the numbers for the first time in umpteen years. This case was decided under the "old" guidelines.
The problem is that the chart only goes up to so much per month. The old guidelines only went to $10K a month. The new ones go all the way up to $15K. If the parents' income is greater than the chart has, the judge has to go "above the guidelines" to determine the correct child support amount. Now, people much, much, much smarter than me and much, much, much more involved in the issue talk about parabolic curves and extrapolations and the like. All that gives me a headache. Basically, a judge has to determine what is the appropriate amount of child support to care for a child in a manner befitting the parent's lifestyle and income.
Sorry, its a fact of live, but a football player making 18K+ a month is going to have a better lifestyle than someone working at McDonald's. The child of the football player should have a corresponding better lifestyle -- whether the child lives with the football player or not. Parents are expects to support and care for their minor children (adult children are a whole other matter -- GET. A. JOB.)
Dad in this case though, wanted his offspring to live at Mom's lifestyle. He claimed that Mom didn't live that extravangantly so why should the child? Yes, Dad actually tried to argue that is was wrong that Mom lived within her means. Mom responded that she would provide the things a child of a football player should have, if she had the money to do so. Since Dad was not paying child support to allow her to do so, she could not.
The Court followed Mom's reasoning. They further did not take too kindly to Dad trying to stiff his own kid out of kid's activities. The Court of Appeals (Maryland's highest appellate court) agreed with the trial court.
Look, every parent paying child support believes the other parent is wasting the money on his/herself instead of spending it on the child. But, a well-paid athlete can afford to provide for his child's reasonable needs without getting too hung up on a little bit going to benefit mom too (like a better house in a safer neighborhood). If your child is cared for and protected, pay up. If not, ask for custody yourself.
But remember, it is for your kid. No matter how you get along with Mom, don't stiff your kid.
*This despite evidence his income had tripled since the original filing.
Jackson v. Proctor
Seems Mr. Jackson and Ms. Proctor were the proud parents of a little girl. Well, Ms. Proctor was proud. Dad was trying to cheapskate the child support. Mom was a full time student. Dad played for the Tampa Bay Buccaneers. At the time of the filing for child support in 1997, Dad was making 18K a month. The final order required him to pay $2500 a month in child support*. He complained that was too much and was unfair.
Let's do the math. 18,000 - 2500 = 15500. In Maryland (yay, a case in the state where I am licensed) child support is calculated before taxes. Even taking out taxes, that leaves a lot left over for living expenses -- providing you aren't buying a lot of bling or big houses and cars. $2500 is a mere 13% of the Dad's monthly income.
This is what we love to call an "above the guidelines" case. The Guidelines are the chart of basic child support that the wise legislators in Annapolis decided was necessary to care for a child. It's a simple chart. You have income down one side (both parent's combined income since both parents are presumed to contribute to their child's support) and the number of children across the top. You figure the combined income, then go to the chart and find where the income cross the number of children. That's the basic child support amount. In 2010, the legislature finally updated the numbers for the first time in umpteen years. This case was decided under the "old" guidelines.
The problem is that the chart only goes up to so much per month. The old guidelines only went to $10K a month. The new ones go all the way up to $15K. If the parents' income is greater than the chart has, the judge has to go "above the guidelines" to determine the correct child support amount. Now, people much, much, much smarter than me and much, much, much more involved in the issue talk about parabolic curves and extrapolations and the like. All that gives me a headache. Basically, a judge has to determine what is the appropriate amount of child support to care for a child in a manner befitting the parent's lifestyle and income.
Sorry, its a fact of live, but a football player making 18K+ a month is going to have a better lifestyle than someone working at McDonald's. The child of the football player should have a corresponding better lifestyle -- whether the child lives with the football player or not. Parents are expects to support and care for their minor children (adult children are a whole other matter -- GET. A. JOB.)
Dad in this case though, wanted his offspring to live at Mom's lifestyle. He claimed that Mom didn't live that extravangantly so why should the child? Yes, Dad actually tried to argue that is was wrong that Mom lived within her means. Mom responded that she would provide the things a child of a football player should have, if she had the money to do so. Since Dad was not paying child support to allow her to do so, she could not.
The Court followed Mom's reasoning. They further did not take too kindly to Dad trying to stiff his own kid out of kid's activities. The Court of Appeals (Maryland's highest appellate court) agreed with the trial court.
Look, every parent paying child support believes the other parent is wasting the money on his/herself instead of spending it on the child. But, a well-paid athlete can afford to provide for his child's reasonable needs without getting too hung up on a little bit going to benefit mom too (like a better house in a safer neighborhood). If your child is cared for and protected, pay up. If not, ask for custody yourself.
But remember, it is for your kid. No matter how you get along with Mom, don't stiff your kid.
*This despite evidence his income had tripled since the original filing.
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