Changes to Child Support for Adult Children and College Expenses Under the 2017 MA Child Support Guidelines

Nicole Levy reviews the major changes to child support for adult children and the payment of college expenses under the 2017 Massachusetts Child Support Guidelines.

Some of the biggest changes announced under the 2017 Massachusetts Child Support Guidelines were to the payment of college expenses and child support for adult children. In this blog, we explore the new changes in these areas in detail.

One of the questions I receive most frequently is about college contributions. In 2016, we published several blogs focused on the ambiguity surrounding the relationship between child support for adult children and college expenses in Massachusetts, along with the challenges associated with drafting college payment provisions in divorce agreements, and the general subject of child support for adult children in Massachusetts. A continuing theme in all of these blogs was a critique over the lack of clarity in Massachusetts surrounding the payment of child support and college expenses for adult children.

With this in mind, we are pleased to note that the recently released 2017 Guidelines address the confusion surrounding college expenses and child support for adult children in Massachusetts in several important ways.

UPDATE (10/6/17): An error has been discovered in the 2017 Guidelines calculation for children over 18. Read more in this update.

Table of Contents for this Blog:

Part 1. – Capping College Contributions Under the 2017 Child Support Guidelines
UMass Cap for College Under 2017 MA Child Support Guidelines Reduces Ambiguity
Impact of New UMass Cap on Existing College Expense Agreements and Judgments
What About Wealthy Parents? Will the UMass Cap Apply in Cases Where Parents Can Plainly Afford to Pay for Private Colleges?
A Potential Sticking Point Under the UMass Cap: Student Loans
Part 2 – Blanket 25% Reduction in Child Support for Adult Children
New Grounds for Modification: My Child Graduated from High School
Deviating From 25% Rule for Adult Children Who Attend College While Living at Home
Seeking a 25% Reduction in Child Support Based on a Child Turning 18 Under the 2017 MA Child Support Guidelines
Not So Fast on that 25% Reduction: Cases Involving Multiple Children

Part 1. – Capping College Contributions Under the 2017 Child Support Guidelines

In my blog last year, I asked: how much each parent can be asked to contribute to college for their adult children? In response to this question, I offered two suggestions:

Nature abhors a vacuum, and judges abhor a rule. Translation: if no rule exists, judges will try to invent one. In Massachusetts (and no doubt elsewhere), two common sense standards have emerged as accepted approaches for apportioning college expenses. The elegantly named “third-a-third-a-third” standard simply posits that the child, mother and father will contribute 1/3 of the cost of college each year, with the child expected to borrow this sum in student loans. Meanwhile, the “UMass cap” standard provides the obligation of parents to contribute to college will be capped each year at the c ost of room, board, tuition and fees at UMass Amherst for that year. In many cases, these two standards will be combined, so that each parent’s contribution to college is capped at 1/3 of the cost of UMass in that year, even if the child elects to attend a more expensive private school.

The 2017 Massachusetts Child Support Guidelines adopt a version of the “UMass cap” as the new rule, providing:

No parent shall be ordered to pay an amount in excess of fifty percent of the undergraduate, in-state resident costs of the University of Massachusetts-Amherst, unless the Court enters written findings that a parent has the ability to pay a higher amount. Costs for this purpose are defined as mandatory fees, tuition, and room and board for the University of Massachusetts-Amherst, as set out in the “Published Annual College Costs Before Financial Aid” in the College Board’s Annual Survey of Colleges.

The new “cap” on each parent’s college contributions at 50% of the annual cost of UMass stretches the definition of a “presumption” under the Guidelines. Historically, the Guidelines have always provided a presumptive minimum level of support in child support cases. However, the new rule does not appear to require parents to contribute to their adult children’s college expense sat all. Instead, the new rule provides that ifparents are ordered to contribute to college, then said contributions should not exceed 50% of the annual cost of UMass Amherst unless the Court enters findings supporting a deviation.

The notion of a presumptive “cap” is uncharted territory for the Child Support Guidelines. This is important to understand, as the Guidelines still require the court’s discretion in determining whether to order parents to contribute to college at all, where the new rule provides:

By statute, the Court has discretion either to order or to decline to order a parent to contribute to post-secondary educational expenses. Contribution to post-secondary educational expenses is not presumptive.

The change should not be misconstrued as a requirement that all parents meet this level of contribution. At the same time, however, attorneys and litigants shouldconsider the portion of the rule capping college contributions at 50% of the UMass cost to be presumptive. In other words, under the 2017 Guidelines, it is not presumptive that parents must contribute to their adult children’s college expenses, but if college contribution is ordered by the Court, then the cap at 50% of the UMass cost presumptively applies.

The 2017 Guidelines suggest that courts deciding whether to order parents to contribute to college should consider the interplay between an existing child support order and the cost of college:

When exercising its discretion to order child support for a child over age 18 and contribution to the child’s post-secondary educational expenses, the Court shall consider the combined amount of both orders.

Accordingly, a party who is paying child support for an adult child could reasonably be expected to argue that he or she should pay a smaller share of college and/or that the child support received by the other parent should result in the other parent paying a higher share of college.

UMass Cap for College Under 2017 MA Child Support Guidelines Reduces Ambiguity

Although the new college contribution cap does not provide a definitive answer to how much parents should contribute to college in every case, the changes under the 2017 Guidelines provide much needed clarity to an area that was essentially the wild west. The 2016-2017 Child Support Guidelines Task Force has provided a clear limit on the obligation of parents, giving much-needed answers to what parents’ potential exposure is. The change will help clean up some of the confusion I blogged about last year:

In the absence of any clear rule (or even consensus) on how college expenses should affect child support, a common scenario that practitioners see is that a court orders one parent to continue paying regular weekly child support to the other parent, but requires both parents to contribute to college. When apportioning the college cost, judges take different approaches. Some judges believe that the college expense should be split equally (50/50) if one parent is paying child support to the other consistent with the Child Support Guidelines. Other judges will look at the parties’ “net incomes after child support” – i.e. how much income each party has available, taking into account child support paid/received by each parent – and apportions the college expense based on the parties’ respective resources.

Under the 2017 Guidelines, parents have an opportunity to begin their financial planning with some degree of certainty, at least in terms of their top-line exposure. As I noted last year, it hardly seems fair that married parents may contribute nothing at all to their children’s college expenses, while divorced and separated parents can be financially broken by court orders forcing them to take out loans and liquidate their retirement plans to pay for their kids’ college costs. The 2017 Guidelines tweaks the commonly used UMass Cap and “Third-a-Third-a-Third” formulas in service of a simple principle: no-one should be required to go bankrupt in order to pay for college tuition. This is a step in the right direction in a tricky area of the law.

Impact of New UMass Cap on Existing College Expense Agreements and Judgments

Clearly, one area of concern with the new UMass cap is how the new rule will affect existing Separation Agreements and judgments that apportion college expenses in a different manner. In my blog, “Who Pays for School: College Expenses and Massachusetts Child Support Agreements”, I noted that it is not uncommon for parties to agree to simply “share equally” in the cost of college in Massachusetts Separation Agreements. Of course, if a child attends a private college, such provisions are likely to result in substantially larger obligations for parents than 50% of the cost of UMass Amherst.

As of the summer of 2017, the cost of room/board/tuition/fees at UMass Amherst for in-state students was $27,669 per year. If a child attends Colby College in Maine, however, his or her parents are looking at a bill of $64,060 per year. Clearly, if the parents previously agreed to share equally in the child’s college costs, the difference in cost between UMass and Colby is rather substantial. Thus, the question becomes: if a child is halfway through his or her attendance at Colby College, can a party seek to reduce his or her contribution to the child’s college based on the 2017 Guidelines’ UMass cap? In its comments, the Task Force appears to address this question head on:

The limitation on post-secondary educational expenses orders is recommended for most cases, but it is not mandatory. The Task Force does not intend the limitation to apply to children already enrolled in post-secondary education before the effective date of these guidelines …

Assuming Massachusetts probate and family court judges read the Task Force comments (not necessarily a given in every case), it appears that parties will not be allowed to use the UMass cap to reduce their obligation to contribute to a child’s college expenses once the child has begun attending school.

What About Wealthy Parents? Will the UMass Cap Apply in Cases Where Parents Can Plainly Afford to Pay for Private Colleges?

As noted above, one area of perceived unfairness that has been cited by divorced parents in Massachusetts is that married parents are not required by law to contribute to their children’s college expenses, while divorced and separated parents are. In the case of very wealthy divorced parents, however, a similar fairness argument could be made by children whose parents refuse to pay for college because of conflict between the parents.

In most high net worth families, where parents earn combined income of $500,000 or more per year, an adult child can reasonably expect his or her parents to pay all or most of the child’s college expenses. However, in cases involving divorced parents, it is not uncommon for parents to refuse or resist making contributions to an adult child’s college because – to put it simply – each parent thinks the other parent should be responsible for paying for college. For children whose parents have the means to pay for a child’s attendance at an elite college, it seems unfair to impose a “UMass cap” that will effectively prevent the child from attending a private college without major scholarships.

The 2017 Guidelines provide:

No parent shall be ordered to pay an amount in excess of fifty percent of the undergraduate, in-state resident costs of the University of Massachusetts-Amherst, unless the Court enters written findings that a parent has the ability to pay a higher amount.

The Task Force comments further provide:

Overall, both public and private four-year college expenses for fees, tuition, room and board, have increased approximately 250%, as adjusted for inflation. See College Board, Annual Survey of Colleges, 2017. The Task Force shared the pervasive concern that many parents cannot pay post-secondary educational expenses from their income, while meeting other expense obligations. The Task Force intended to discourage orders requiring parents to incur liability for loans in excess of state university costs unless the parents agree to accept such liabilities. …. The Task Force does not intend the [UMass cap] to apply to … parents who are financially able to pay educational expenses using assets or other resources.

In its comments, it seems clear that the Task Force sought to discourage judges from applying the UMass Cap in cases where the parents have the clear ability to pay for private colleges. As noted several times in this blog, however, it remains to be seen how many judges will elect to consider the Task Force’s comments, however, where such comments are not part of the 2017 Guidelines themselves.

A Potential Sticking Point Under the UMass Cap: Student Loans

As noted above, the cost of attendance in 2017-2018 at UMass Amherst for in-state students was $27,669. It should be noted that paying for college has become increasingly complicated in recent years as college costs have far outstripped increases in Americans’ income levels. Indeed, recent reports indicate that college attendance has dropped off dramatically across the United States in recent years as students buckle under skyrocketing tuition prices and crippling student loans:

A startling decline in U.S. college enrollment reflects growing doubts about the value of a degree at a time when tuition is surging, grads are strapped with crushing student loan debt and financial aid awards are shrinking.

The number of Americans enrolled in colleges and universities has dropped every year since 2011, to a low of 19.1 million in 2015, the most recent year tallied, according to the U.S. Census Bureau.

That’s a full 1.2 million fewer students than were enrolled in 2011.

Against this backdrop, one potential sticking point with the UMass Cap under the 2017 Guidelines is that it may make it impossible for adult children to attend elite colleges due to limits on how much a typical 18-year old American can incur in his or her own name alone. Current federal law limits first year borrowing for “dependent” students to $5,500 in federal student loans. Independent students and dependent undergraduate students whose parents are unable to obtain PLUS Loans may borrow up to $9,500 in federal loans in their first year. Whichever metric one uses, it is clear that federal student loans alone fall far short of covering the cost of college for most undergrads.

For adult children hoping to attend private colleges – where annual fees and costs regularly exceed $70,000 per year – applying the UMass Cap to parental contributions is likely to put the private college out of reach for the child. Indeed, even if the parents contribute the full cost of a year at UMass Amherst (i.e. $27,669 in 2017-2018), most undergrad students will be unable to borrow the additional $30,000+ required for them to attend a private college.

None of this is to suggest that the UMass Cap is a bad idea; indeed, I believe the new rule brings much-needed clarity to complex area of law. However, parents and college-age students should remember that the actual cost of college may be quite different from the contribution levels provided in the parents’ divorce agreement. Where the 4-year cost of a private college today routinely exceeds the total balance of both parents’ combined 401K accounts, parents must make tough choices about how to use their money.

Part 2 – Blanket 25% Reduction in Child Support for Adult Children

In some ways, the impact of the UMass Cap on college expenses pales in comparison to the impact of any event bigger change under the 2017 Child Support Guidelines: the blanket 25% reduction in child support for adult children across Massachusetts. As Attorney Owens recently blogged, the effect of this sweeping new rule are likely to be felt immediately throughout Massachusetts Probate and Family Courts:

Section II(F) of the 2017 Child Support Guidelines provides that “[i]f the Court exercises its discretion to order child support for children age 18 or older, the guidelines formula reduces the amount of child support” by 25% compared to child support of minor children. (Important note: the 25% reduction does not apply to 18-year old children in high school, but takes effect after adult children graduate from high school.)

It is important to note that under the new rule, discretion for ordering child support for adult children remains with each judge. Thus, a Massachusetts Probate and Family Court judge is not presumptively required to order child support for a child over 18 years of age (or who has not graduated from high school). However, much like the UMass Cap discussed above, the 25% rule creates a presumptive “cap”. In other words, if a judge order exercises his or her discretion to order child support for an adult child, the new rule imposes a presumptive cap on said child support at 75% of a standard Guidelines order.

The new rule is a sweeping change that will result in a major surge in modification filings when the 2017 Guidelines go into effect on September 15, 2017.

New Grounds for Modification: My Child Graduated from High School

Early last year, I published a blog entitled, “Child Support for Adult Children in Massachusetts: When Does it End?” In this blog, I wrote about how child support orders remain in effect after a child turns 18 in Massachusetts:

Although a child who has graduated from high school is not automatically entitled to chsild support, one thing that’s very clear is this: a Massachusetts parent with a child support obligation cannot simply stop paying child support after his or her child has turned 18, just because the parent does not believe the child qualifies for post-minority support under the statutes. Unless the child has turned 23, the parent paying child support needs a court order to stop making payments.

It is worth repeating: unless the child support order specifically states that payments will stop when the child turns 18 or graduates from high school, parents should continue paying child support until the Court provides explicit permission to stop. The parent seeking to stop paying child should file a Complaint for Modification seeking the termination of child support. A parent who unilaterally stops paying child support after a child turns 18 can end up owing money – even if the child would not have qualified for post-minority child support under Chapter 208 or 209C.

As I noted in that blog, even though the Child Support Guidelines do not presumptively apply to adult children in Massachusetts, a parent cannot simply stop paying child support because his or her child turned 18. Instead, a parent must file a Complaint for Modification and provide proof that a material change in circumstances has occurred warranting a downward modification in child support. Thus, in many cases, child support orders that were established when children were minors continued in full effect after the children turned 18 in Massachusetts.

The new 25% rule changes this situation rather dramatically. In its comments on the rule change, the Task Force noted that “these guidelines apply in all cases where a child support order is established or modified and not just in cases involving children under age 18.” The inclusion of the word “modified” is important here, since it suggests that any party paying child support for an adult child may seek a 25% reduction in the order based on the new rule. The Task Force explained the reasoning behind the rule as follows:

The Task Force agreed that a twenty-five percent reduction is appropriate as it takes into consideration factors typical of this age group. For example, the child may be living away at school thereby reducing some of the household expenses for the recipient or the child may be living at home and is not enrolled in a post-secondary educational program and should be working and contributing to the household expenses. The reduction balances the requirement imposed by federal regulation that all child support orders are the product of a formula established by guidelines, while also considering important factors unique to children between the ages of 18 and 23.

(As an aside, we should note that the 2017 Guidelines do not explicitly state that child support for adult children is subject to a 25% reduction. Instead, the rule provides: “If the Court exercises its discretion to order child support for children age 18 or older, the guidelines formula reduces the amount of child support in accordance with Table B of the guidelines worksheet.” However, if one performs the math under Table B of the worksheet, it becomes apparent that the rule provides a 25% reduction from the Guidelines. Further, in its comments accompanying the new Guidelines, the Task Force explicitly states that a “a twenty-five percent reduction” in child support is the result of the new rule.)

Deviating From 25% Rule for Adult Children Who Attend College While Living at Home

The Task Force comments on the 25% rule make an important point about when a deviation from the 25% reduction may be appropriate:

Nothing in this section limits the ability of the Court to deviate from the presumptive order where appropriate. For example, the child may be living at home and commuting to a post-secondary educational program.

This comment is both important and revealing. The comment is revealing because it suggests a recognition, by the Task Force, that when a child lives in a college dormitory, the cost room and board are included in the cost of the college. In other words, a parent should not receive full child support for a child who lives at college for 9 months a year. The comment is also important because it provides clear grounds for deviation from the 25% reduction when a child attends college while living at home full-time with one parent. Clearly, when a college attending child lives at one parent’s home, that parent absorbs a significantly higher share of incidental costs (such as food, utilities, etc.) compared to scenarios when the child lives in a college dorm.

The Task Force’s comment suggests that for parents whose adult children commute to school, a strong argument can be made for the continuation of “full” child support under the Guidelines.

Seeking a 25% Reduction in Child Support Based on a Child Turning 18 Under the 2017 MA Child Support Guidelines

It seems clear that the most immediate impact of the 2017 MA Child Support Guidelines will be felt in cases in which a child support-paying parent files a complaint for modification seeking a 25% reduction in child support for his or her adult children. Until now, such cases had been complicated by the need for the parent seeking modification to prove a “substantial change in circumstances” that justified a reduction in child support. However, the 2017 Guidelines suggest that it now may be enough for such parents to simply file a complaint for modification and point to the new rule as presumptive grounds for an immediate 25% reduction.

In practice, parents seeking a 25% reduction in child support for adult children rule may face some challenges as courts adjust to the new rule. In the seminal case of Morales v. Morales (2013), the Supreme Judicial Court held that a party seeking a modification need not prove a substantial change in circumstances to modify child support. Instead, a party could obtain a modification of child support simply by proving that the current order was “inconsistent” with the Child Support Guidelines:

Nothing here or elsewhere in § 28 establishes a separate and additional requirement that the discrepancy or inconsistency between the existing order and the guidelines amount of child support result from a material and substantial change in circumstances.

The 25% reduction language set forth in Section II(F) of the 2017 Child Support Guidelines suggests that any child support order – including those set forth in a final judgment – that result in child support above 75% of the guidelines formula for adult children would be “inconsistent” with the new rule articulated in the 2017 Guidelines. Thus, under Morales, it appears that child support-paying parties will not be required to prove a change in circumstances in order to obtain a 25% reduction under the 2017 Guidelines.

However, attorneys and litigants must be mindful that it often takes time for individual judges to fall in line behind major changes in the law. With respect to the 25% reduction in child support for adult children, it is likely that judges will differ in their interpretation of the rule in the months following the effective date of the new Guidelines. Some judges may interpret the rule as still requiring a party to prove a change in circumstances to obtain a reduction in child support, despite the seeming applicability of Morales. Other judges will be hesitant to allow an immediate 25% reduction for a party seeking temporary orders under a Complaint for Modification, thereby forcing plaintiffs to keep paying full child support until a future trial has concluded. Few can predict how the Massachusetts Appeals Court and Supreme Judicial Court (SJC) might interpret a provision such as the 25% reduction rule. (Certainly, with the Massachusetts Alimony Reform Act, the SJC’s 2015 decisions caught most judges, attorneys and litigants by total surprise.)

Until parties begin filing Complaints for Modification seeking an immediate 25% reduction in child support for adult children, we will not know for sure how the new rule will operate in practice.

Not So Fast on that 25% Reduction: Cases Involving Multiple Children

A final complicating factor surrounding the 25% reduction rule is cases involving a mix of adult and minor children. It will be important for parents to remember that the 25% reduction rule is likely to have a much-diminished impact on child support in cases in which at least one child is under 18 years of age. A close examination of the Child Support Guidelines formula reveals that child support increases only 20% for a second child, and an additional 5% for each additional child (up to 5 total children). Thus, in cases in which at least one child remains a minor, the impact of the 25% reduction rule is likely to be limited, regardless of how many adult children are subject to the order.

Thinking strategically, child support-paying parents should consider carefully the timing of a Complaint for Modification based on the 25% reduction rule when there are multiple children subject to the order. The real question in such cases is likely to be this: at what point will all of the children be at least 18 (or graduate from high school)? In some instances, it may make sense for a party to file several months in advance of the youngest child turning 18. In cases where at least one child is likely to remain an unemancipated minor for several years, however, a premature filing will simply result in unnecessary legal costs.

About the Author: Nicole K. Levy is a Massachusetts divorce lawyer and Massachusetts family law attorney for Lynch & Owens, located in located in Hingham, Massachusetts and East Sandwich, Massachusetts. She is also a mediator for South Shore Divorce Mediation.

Schedule a consultation with Nicole K. Levy today at (781) 253-2049 or send her an email.