Child support
My wife and I are backed into a corner where we are going to have to file for bankruptcy.
She is in court to get child support arrears.
If/when she gets the arrears payments,are they considered income being as they are funds for the child?
Also, both our children have educational accounts(not RESPs)One of these is in the daughters name,but to obtain better interest for her, the other daughters funds are in a GIC.(She is 21 and living on her own)
What of ongoing child support payments?
Are they considered income if deposited directly to the childs account?
I really don’t want to see our childrens futures jeopardized by our actions.
If you file a bankruptcy in Canada child support is a debt you cannot be cleared from. However, what most people find is that by dealing with the rest of their unsecured debt it frees up money that can now be used to make the child support payments. For more information on how either consumer proposal or a bankruptcy can help to do this you should contact a licensed trustee in your area.
You’ve asked enough questions that I think you may as well take the next step and contact a trustee in your area for an initial meeting.
The short answers to your questions are:
1) the support arrears would be treated as income in the month they are received and subject to surplus OR they would be treated as a windfall and seized completely
2) RESPs are an asset that may be seized in bankruptcy
3) regular support payments are treated like every other form of income and are subject to the surplus rules regardless of where they are deposited.