How Child Support is Calculated Under New York Law
In the legal system, the Child Support Standards Act ("CSSA") will be applied to determine the amount of child support that will be paid by the spouse who does not have primary physical custody of the children. In mediation, it may be possible to opt out of the CSSA guidelines and to devise a support scheme that will meet the family's needs and provide significant tax savings as well. The purpose of this section is to set forth the basic formula that the legal system employs to establish child support.
There are two components of child support: basic child support, which is a sum of money, usually paid monthly, that is meant to provide a portion of the children's basic needs (food, shelter, clothing, and day to day entertainment and some others). The second is referred to as "add-on" support and is a contribution to the children's medical, educational, and certain child care expenses.
1. Basic Support.
Basic support starts with each parent's gross income (earned and unearned). 1 From the gross income, there are certain allowable deductions, the chief of which are FICA and Medicare tax, New York City tax, Yonkers tax, and alimony and child support that is actually being paid by a spouse to a former spouse or a child of a former marriage.
The amount remaining is each parent's adjusted income. These two amounts are added together to give the combined parental income to which the applicable percentage is applied. The applicable percentage is 17% for one child, 25% for two children, 29% for three children, 31% for four children, and 35% for five or more children. By way of example:
Husband and Wife live in New York City. They have two children who reside primarily with the Wife. Husband's gross income is $100,000; his allowable deductions (FICA, Medicare tax and NY City tax) are $10,906, leaving him adjusted income of $89,094. Wife's gross income is $60,00, her allowable deductions are $6,188, leaving her adjusted income of $53,812. Their combined adjusted income is $142,906.
The statute mandates that the applicable percentage must be applied to the first $130,000 of combined parental income. In this case, 25% of $130,000 is $32,500. The Husband's pro-rata share of that number is 62.34% ($89,094 is 62.34% of their combined adjusted income), or $12,468 . On a monthly basis, that would be $1,039 that the Husband would be mandated to pay to the Wife for the children's basic needs.
This does not mean that the Wife does not contribute to the children's basic needs. She is expected to contribute her pro rata share of $32,500 ($7,532 in this case) to the children's basic needs.
The statute gives the court the authority to apply the applicable percentage to the entire adjusted combined parental income, in which case, the Husband would pay $22,272 a year or $1,856 a month for the children's basic support.
2. Add-On Support.
In the example given above, the Husband's pro rata share of combined parental income is 62.34% and the Wife's share is 37.66%.
Each parent is mandated to pay his or her pro rata share of support for the children's medical insurance, out of pocket medical, dental, and pharmaceutical and related expenses, and for educational expenses (if private school is determined to be appropriate) and child care that is necessary for the custodial parent to work or to search for work or get education leading to work.
Frequently, in negotiated agreements, the add-on support is expanded to include extra-curricular activities, summer camp, birthday parties and a host of other expense incurred for the children.
3. Tax Consequences of Child Support.
Child support is not taxable to the spouse who receives it; nor is it deductible by the spouse who pays it.
4. Length of Child Support Obligation.
In New York, child support is payable until a child reaches the age of 21. The court does not have the authority to award child support after that age (unless the child is disabled). Under certain circumstances, a child may be deemed to be emancipated earlier, e.g., if he or she is 18 years old, is not attending school and is working full time.
If the non-custodial parent is contributing to the higher education of a child, the court may reduce the amount of basic support that the non-custodial parent is obligated to pay.
In many negotiated or mediated agreements, the age of emancipation is often extended until the child has graduated from college.