In Indiana, as most of the country, Courts have quite a lot of discretion when it comes to enforcing a child support obligation. For example, Courts can use their contempt power or issue an income withholding order as means to enforce a child support obligation. While the Court’s are granted a lot of discretion in determining how to enforce a child support obligation, there are limitations to their powers. But you may be wondering, what are these limitations? Or, what if I have an LLC? Can child support go after someone’s LLC? In this blog, we look to answer these questions and provide general insight into the enforcement of child support obligations.
The legal term for an individual who owes an outstanding amount of child support is known to be in “arrearage.” For example, if a court-ordered an individual to pay $100 a month in child support and that individual failed to pay child support for six months, then that individual would owe $600 in child-support arrearages. When an individual has a child-support arrearage, the trial court then has a variety of different enforcement methods that can be used to collect the outstanding amount. Indiana statutory code provides that a trial court has the ability to enforce a child support arrearage by: (1) contempt; (2) an income withholding order; or (3) any other remedy available for the enforcement of a court order. As you may have noticed, the third provision is very vague, which opens the door for the trial court to use several different means of collecting the outstanding amount.
Now, generally, a Limited Liability Company (LLC) will be safe from a court order to pay child support. The reason being is that an LLC is designed to separate your personal assets from your business assets, and child support services are generally prohibited from garnishing funds from a business account. It is important to note, however, that there are situations in which it may be possible for child support to come after your LLC (or more accurately put, the LLC’s assets). For example, if you fail to properly run the LLC, such as mixing business and personal assets, the LLC’s liability protection may be void, and thereby put the LLC’s assets at risk. Thus, while an LLC is generally safe from child-support, be aware that the potential does exist in the risk circumstances.
These types of situations are extremely fact sensitive. This information contained in this blog is general in nature, and it is important to remember that there are many exceptions and circumstances that could lead to a different result than discussed above. Obtaining skilled counsel is key to relieving some of the burden that comes with child-support related issues. This blog was written by attorneys at Dixon & Moseley, P.C., who handle a wide variety of family and business-related issues throughout the state. It is written and posted for general educational purposes and is not to be construed as legal advice or solicitation for services. It is an advertisement.