Child support fraud includes avoiding paying child support by avoiding employment, switching jobs, working for cash, holding assets in others’ names, or declaring less income. It is easier to trace payments with a paper trail, and some may place assets in others’ names or report less income if self-employed.
Child support fraud is a term used to refer to the act of identifying ways to avoid paying as much child support as you should or to avoid paying child support altogether. An individual could engage in child support fraud by purposely avoiding employment, switching from one job to another, working for cash, holding income and assets in the name of others, or declaring less than the actual self-employment income earned. It is also important for an individual to verify that an automatic means of payment, such as employer withholding, is functioning properly so that he or she does not engage in child support fraud unintentionally.
The amount payable in child support typically is directly linked to the amount of money an individual earns, so some people responsible for paying child support decide to avoid working. When no money is being earned, no money in the form of child support can be paid. In some areas, unemployment income may be garnished to pay child support.
Another tactic some people use to commit child support fraud is to jump from job to job. It is difficult to get money from an individual if you don’t know where they are. Paperwork must be submitted to the government when a new job is started, so this provides a way to trace someone. After being found, these individuals may move on to another job and the process of finding them has to start all over again.
It is much easier to get child support when there is a paper trail. The amount paid is typically based on what someone earns, and if it’s paid in cash, there’s no paper trail to follow. This could mean that his or her earnings appear substantially less on paper or that he or she does not earn at all. In either case, the court system generally uses documented earnings information to determine the amount to pay.
Sometimes, if an individual owns a lot of assets, he will attempt to place them in the name of others. This prevents these assets from entering the child support equation. This type of fraud could take the form of placing a house in another person’s name or placing a bank account in a child’s name.
Self-employed persons could commit child support fraud by reporting less income than they actually earned. Many times, the court has to base its decision on what is recorded on paper. If a self-employed person was paid in cash or used some sort of creative accounting method, their records may show less than they actually earned.
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