Child Support & Your 401(k)

Does it sound reasonable for a parent to seek a downward modification of his/her child support obligation when he/she has substantial assets sitting a 401(k) account that are not considered in the child support calculation? What about the child’s right to financial support?

retirement%20picture.JPGA party’s contribution into a 401(k) account and the income generated in a 401(k) are not used in the child support calculation as it is not considered available to the defendant over an extended period of time. The assets are not ordinarily accessible and the party withdrawing from the account would face an exorbinant tax burden for withdrawing money prior to retirement.

Forrestall v. Forrestall, 389 N.J.Super. 1, 910 A.2d 621 (2006).

Additional reasoning behind this rule is that children of an intact family would not expect to benefit from either the employer’s contribution or the accretion to the plan.

Nonetheless, money contributed into the account from salary, wages etcetera is attributable to overall income and will be included in the child support calculation.

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