University of Wisconsin–Madison
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Reducing the Interest Rate Charged on Child Support Arrears

Effective April 1, 2014, Wisconsin implemented a pilot program that reduced the amount of interest due on child support arrears from 1 percent per month (12 percent per year) to 0.5 percent per month (6 percent per year). One impetus for the change was the belief that reducing the interest rate, and thereby reducing the amount of interest that accumulates, would incentivize the payment of arrears. In this report, we analyze patterns of arrears accumulation and payment on arrears before and after the policy change to see whether the policy had its intended effect.

Categories

Arrears & Related Policy, Child Support, Child Support Policy Research

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