1099 Workers and Wage Garnishment
The rise of the ‘gig economy’ through companies such as Uber, DoorDash, and AirBnB and its effects on the labor market, worker protection and access to benefits has sparked much conversation. For those trying to collect child support, this type of work presents a new slant to the longstanding challenge of establishing and enforcing child support orders for noncustodial parents working outside traditional salaried employment. Let’s face it, these kinds of jobs present an opportunity for child support evaders to abandon the financial obligations to their children.
The COVID crisis brought the country to a halt, and for the first time in their life, many people found themselves jobless and without prospects. Nontraditional work arrangements provided individuals with income with greater flexibility to choose work hours and tasks and of course, withhold their income. Additionally, while these types of jobs may allow workers avenues to earn income, certain employee-based benefits and subsidies such as health insurance, retirement benefits, and life insurance are typically not unavailable.
It’s not uncommon to hear that a parent quit his steady job when the reality of wage garnishment hit his check and instead finds work as a 1099 (independent contractor) employee. Workers classified as independent contractors enables them to under-report their earnings – effectively lying to avoid contributing their fair share via wage garnishment. Businesses tend to hire independent contractors because they can avoid payroll taxes, overtime and workers’ compensation. These “tricks” allow for a culture of getting away with what you can at the expense of someone else, and because of COVID, is far more common than it used to be.
The diversity of these types of work arrangements increases the challenges facing child support enforcement agencies who are tasked with collecting money from noncustodial parents to meet their child support obligations. Therefore the go-to option of wage garnishment isn’t the answer. While there are tactics that can be employed, such as till-tapping and asset seizure, they require insight into back child support collection that most CSEs won’t provide.
To find unreported income now requires investigating and can be costly if you decide to hire a lawyer or a P.I. when the evader owes you back child support, to review tax returns, cash flow in bank accounts, and parents’ lifestyle and purchases, If your ex just bought a brand new Mercedes but claimed $21, 000 on his tax returns, it’s obvious you will need to follow the money trail. Custodial parents and social media provide clues but these methods are not sustainable and as usual, the laws have not kept up with the changing times allowing evaders to avoid complying with any court orders to pay child support. Like I said, it’s an old problem dressed up in a new industry.
There is a push to change legislation but until that time, what happens to the countless moms waiting for child support payments to feed their families? You owe it to yourself to try nontraditional child support collection tools. Do your homework and source an online self-serve solution that is user-friendly, costs way less than a lawyer, uses skip-tracing technology, can find the hidden cash in non-bank accounts like PayPal or Venmo and is able to build a relationship diagram on your ex to find the assets he transferred over to other people so you don’t get your hands on it. Traditional methods can’t do this easily or without putting a dent in your pocketbook, but we can.