Knowing Your Ex’s Entire Income When Calculating Child Support
In New York State, courts will order child support when parents of children are unmarried or have divorced, to ensure that both are contributing equitably to the child’s upbringing, and that the child’s standard of living won’t suffer because of the parents’ separation. It can be difficult, though, to reduce all the expenses of raising a child down to a weekly payment plan – especially if the child is young and those payments are to continue for many years.
If you’re the spouse who will be receiving the payments, it will be important, then, for you to take a methodical approach to child support. Just as you should think ahead to expenses not covered by child support payments – like health insurance and non-reimbursed medical expenses, private school, summer camp, driver’s insurance, and college – you’ll also want to make sure the calculations determining the amount of support account for the full income of the paying spouse. This can get tricky when the paying spouse makes money “off the books,” has a fluctuating income, or is compensated outside of his or her salary (as with bonuses, stock options, etc.).
Calculating child support in New York State: an overview
In New York State, the Child Support Standards Act determines the amount of child support payments. If two parents are divorced or living separately, one will have primary physical custody of the children. The non-custodial parent will make weekly payments to the custodial parent based on a yearly percentage of his or her income.
In other states, the amount of child support payments will also depend on the division of parenting time (such that a non-custodial parent who has the children close to 50 percent of the time will not pay much in child support – the court would consider that person already to be financially supporting the child). This is not the case in New York: child support payment calculations are simpler, factoring in only the non-custodial parent’s income and the number of children.
- One child – 17 percent of the payor’s annual income
- Two children – 25 percent
- Three children – 29 percent
This is gross income, less FICA (Social Security and Medicare); the court calculates it before state and federal income tax are deducted.
Accounting for a spouse’s bonuses when calculating child support
Many child support payors have an income that exceeds their base salary: executives, equity partners, and people in sales positions, especially, receive income in the form of bonuses, stocks, and dividends. When calculating child support, courts will factor in all the sources of income that the noncustodial parent has. Different courts have different methods of doing this, however. Some courts will assess child support based on the base income alone, and will add a provision for increases triggered by bonuses. Other courts will assess child support based upon the entire income from the prior year, or an average of the last 2 or 3 years, basing “gross income” on salary plus anticipated bonuses.
This “works,” but it isn’t perfect. Parents who can’t count on bonuses remaining steady over the years may find themselves making child support payments well above the 17 or 25 percent of their income that the state’s standards suggest. Before you enter child support negotiations, or present evidence of income to the court, you should discuss with your attorney the particulars of your compensation structure and the stability of your bonus pay.
Calculating child support payments when your spouse works off the books
Calculating child support can be difficult when one parent works “off the books,” or has some form of undocumented or irregularly documented income.
If the paying spouse enjoys a standard of living that doesn’t match his or her reported income, you and your attorney must investigate, employing forensic accountants or other specialists if need be. With thorough investigation, you will be able to establish an “income base” from which to calculate equitable child support payments.
Client-directed strategies for calculating child support
Whether you’re an unmarried parent or you’re in the process of divorcing, child support negotiations aren’t a “quick fix” to anything. You’re erecting some of the scaffolding for your children’s future: the terms you set now will not only ensure their access to the essentials of food, clothing, and shelter, but will also determine their education, healthcare, ability to travel, and general standard of living.
You need an experienced child support attorney in Saratoga NY to handle your case – someone who can foresee the childcare expenses you might be forgetting, someone who knows where all the money is usually “hidden.” Jean M. Mahserjian has been handling child support cases for more than 20 years; she and her experience, attentive team of attorneys can provide the representation you need.