September 16, 2019

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The Various Methods for Calculating Alimony Payments

 

The process by which you determine child support varies depending on the state you live in. Each model utilizes its own formula and different states might apply their own variation to one of the generic models. In what follows, we will discuss the basics of the various methods used to calculate child support obligations.

Income Shares Model

The most common formula, used in 39 states, is the Income Shares Model. This formula is designed to provide the child (or children) monetary support equivalent to the support provided prior to the divorce. By using this model, alimony is divided on a more equitable basis and therefore ensures neither parent will be expected to take on any undue financial burden. In three states, the Income Shares Model is made more complex via the Melson Formula, which uses policy directives to determine an amicable outcome for both the children and the parents.

What does the Income Shares Model look like in practice? The precise formula varies from state to state, but it essentially breaks down into the following steps:

Total Net Income

First things first: calculate total net income for both parents. This may involve the conversion of gross to net income. To that end, there are usually premade charts to facilitate this translation. In short, if one parent makes a net (monthly) income of $1,000 and the other makes $4,000, then the combined income would be $5,000.

Percentage of Total

Next the court will need to determine how much each parent contributes in terms of percentages. In this case, the former parent contributes 20 percent to net income while the latter accounts for 80 percent of the total.

Child Support Obligation

The total amount of child support will then be calculated by way of a predetermined percentage. According to the formula in Illinois, our exemplar parents would be obligated to spend $943 on one child, though this varies depending on where you live. In Pennsylvania, for instance, it would be $990, but for the purposes of our example, let’s stick with Illinois’ number. In some states, other expenses might be taken into consideration. For example, if there are specific medical expenses, the court might tack these onto the total. Let’s say it’s an additional $50, making for a total of $993 in child support.

Proration

The final child support obligation is then prorated according to each parents’ portion of the total income. The parent making less money would thus be expected to contribute $198.60 while the other parent would be obligated to offer $794.40.

Expectation of Payment

In most (if not all) cases, the parent who has custody of the child will not be expected to prove that he or she has paid child support – this will be presumed. But the parent without custody – let’s say for our purposes it’s the parent with lower income – will be obligated to pay $198.60 per month to the custodial parent.

The Percentage of Income Model

The Percentage of Income Model, which is used in only nine states, is more straightforward than the Income Shares Model and can sometimes result in burdensome costs for non-custodial parents. There are two kinds: the Flat Percentage Model and Varying Percentage Model. The former ignores variations in income levels when determining percentages of income, while the latter takes income levels into consideration.

At its most basic, the Percentage Income Model applies a predetermined percentage to the non-custodial parent’s monthly income and then adds special expenses (such as medical expenses) to the obligation. So in Wisconsin, if you make $2,000 a month, you have to apportion 17 percent of that money toward child support, making for a total of $340. And then, in some cases, you’d have to apply other extraordinary expenses.

Illinois Takes on Income Shares Model

One of the more recent developments in child support law happened in Illinois where, beginning on July 1st, the state commenced an Income Shares Model. A simple summary of the change can be found on the website of Thaddeus M. Bond, Jr. & Associates, PC.

If you are currently in the process of getting a divorce and there are children involved you may want to reach out to a divorce attorney if you haven’t already. With solid legal assistance, you can better prepare yourself for future financial obligations and other unforeseen variables. It’s always best to be prepared.

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