Family Law

Effect of Inheritance on Child Support

By Kristina Otterstrom, Attorney
How an inheritance can suddenly change child support.

Determining Child Support

Child support becomes necessary when parents separate or divorce. Children in all states have a fundamental right to financial support from their parents, but each state has its own guidelines for calculating an appropriate amount of child support. Many states allow parents to estimate their support obligation through an online child support calculator, like this one, provided by the California Department of Child Support Services. Click here to find your local office of child support Services.

A parent’s estimated support obligation is based on each parent’s income, number of overnights with the child, and the number of children the parent is supporting. Judges can deviate from the state child support guidelines and may reduce or increase a parent’s child support obligation based on each parent’s financial situation and assets. Generally, gifts and inheritances aren’t considered income for child support purposes. However, a court may construe an inheritance as income if a parent refuses to work, but uses the interest accrued on the inheritance to cover living expenses. Whether an inheritance is considered income will depend on how it’s paid and how it’s used.

Understanding Inheritance Types

Individuals receive gifts or inheritances through various sources and through different means. For example, you may receive a car or a home as your “inheritance” from your parents when you reach age 18. Other inheritances might be in the form of stocks, a large lump payment, or monthly installments. While laws vary, in most states a single lump sum payment or receipt of a valuable item (like a car) won’t count as income for calculating child support. Yet, in many states interest, monthly installment payments or regular dividends on stocks received as part of an inheritance trust fund are deemed income. There is no hard and fast rule, but if you're receiving a large amount of regular income or payments from an inheritance, it can affect your child support obligation.

Depending on the type and amount of inheritance you receive, you may want to accelerate or delay a child support proceeding. For example, if you know that your ex will be receiving a large inheritance, you’ll likely want to delay the court’s child support determination until that happens or let the know that an inheritance is coming soon. Courts reason that a parent with a large amount of savings or assets has more money available to pay support.

Inheritances and Modifying Child Support

If you already have a child support order in place, and one parent has received a substantial amount of inheritance money, you may need to ask a court to modify child support. To reduce or increase child support, one parent needs to show that a material change in circumstances has occurred. A material change might be one parent’s promotion or job loss. An extreme increase or decrease in a parent’s income will impact child support payments, but inheritances aren’t always construed as income. Specifically, a court can’t consider the house you inherited in its modification determination. But if you collect rent on the inherited house, the rental profits can be considered.

One parent’s receipt of an inheritance won’t automatically result in increased child support, but if it drastically changes that parent’s standard of living, support amounts may go up. The role of inheritances on child support payments is complex, so you may want to consult a local family law attorney for advice.

Questions for Your Attorney

  • I’m expecting an inheritance from a relative very soon. Does it matter if I receive the inheritance before the initial child support determination?
  • If my ex receives a large inheritance, can I request an increase in child support payments based on the inheritance?
  • Do I have to tell my ex or the court if I receive a large inheritance?
  • What happens if my child’s other parent receives and spends a significant inheritance before I'm able to seek a modification of child support?
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This article was verified by:
Jacqueline Newman | April 02, 2015
521 Fifth Avenue, 31st Floor
New York,NY

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