New York’s Dollar-For-Dollar Room and Board Credit for College Students

New York’s Dollar-For-Dollar Room and Board Credit for College Students by Fabienne Swartz

{4:27 minutes to read} I have long been suspicious of the way New York considers the issue of college room and board as it relates to child support: Currently, the non-custodial parent is permitted to deduct the entire amount of college room and board paid. This is known as a “dollar-for-dollar” credit, which gets offset from child support payments while that child is attending classes. And that amounts to the custodial parent footing the bill for the child’s food and shelter in college.

Note: a) 529 college savings plans can be used to defray the cost of attending college (tuition, room, board, and other costs) and the dollar-for-dollar credit will not apply; b) in cases of multiple children, the credit only goes against the college student’s portion of the child support paid.

In my opinion, and in the opinion of Robert J. Jenkins writing in the New York State Bar Association’s Family Law Review, the dollar-for-dollar credit is a departure from the spirit of the law governing child support, known as the Child Support Standards Act. To see why, let’s examine how it plays out in a (hypothetical) real-life situation:

Joe has to pay $50,000 a year in child support to Jane and gets a dollar-for-dollar credit for room and board in the amount of $15,000. Applied against the child support amount it means that he will pay $15,000 to the college and $35,000 to Jane. This is really the equivalent to tasking Jane with directly paying the room and board to the college.

At the same time, Jane’s overhead costs have not changed. The kids are going to college for seven and a half months out of the year, so that leaves four months of vacation where they will need a place to live and food to eat—and that’s in addition to various other breaks throughout the year.

The biggest cost of having children is really maintaining the home—whether it’s a house, apartment, co-op, etc.—not the food. And those household expenses do not go down when fewer people are in the house.

Let’s look at a few examples that show how a custodial parent may end up paying more than half of their child’s college education:

1. Jane and Joe Doe’s oldest son, Will, is attending a SUNY school. Although Jane is working, she is earning far less than Joe and is thus receiving child support. The breakdown of the cost of attending a SUNY college is as follows:

•Tuition: $6,470

•Room and Board: $14,348

•Fees: $2,801

•Total cost: $23,619 

In this case, whether or not Jane contributes to the tuition if Joe gets a credit for the full amount of room and board paid against the child support, Jane will end up paying at least 60 %—or at least $14,438—of the entire cost of her son’s college costs.

2. Now, let’s consider a scenario in which Will attends a private institution, and Jane and Joe are splitting the tuition and cost 50/50: 

•Tuition: $50,000

•Room and Board: $15,500

•Fees: $2,500

•Total cost: $67,250

Jane would have to pay $26,250 towards the tuition and fees, plus an additional $15,500 towards the room and board, making her contribution $41,250 out of the total cost of $67,250—or 61%! The takeaway from this example is that even if a couple starts out with the intent to split the cost 50/50, the dollar-for-dollar credit makes it 61/39!

In this case again, Jane ends up with more than half of the cost of college, when she is the one who is earning far less than Joe.

How should the custodial parent make up for this shortfall? Spend less on food? How much less? How can that be normal? How can that be fair?    

From my perspective as a financial professional, the room and board should be considered a children’s add-on expense, instead of something else. It should be taken out of the realm of child support completely. There is no reason why the custodial parent should foot the entire bill for the room and board.

I understand that college expenses are exorbitant, and that shifting the burden to the non-custodial parent is not fair. On the other hand, saying that the custodial parent gets hit by a dollar-for-dollar credit is not right either, because that parent would be paying for all of the room and board.

Perhaps the solution to this problem can be found in the way we already deal with add-ons: Each person’s contribution is based on their individual income.

If you need help understanding how much the dollar-for-dollar credit on college room and board works in New York, I can help. Contact Financially Strong by clicking here.

Fabienne Swartz JD (Belgium) CDFATM
Certified Divorce Financial AnalystTM
500 Mamaroneck Av.
Suite 320
Harrison, NY 10528
(914) 798-6940

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