Both parents of a child are obligated to provide financial support for a child. There is a multi-step process involved in determining child support in Pennsylvania. First, income is determined. Next, the base child support amount is calculated. Then, allowable adjustments are considered. This is the first in a three-part series on these steps.
The income figure used to calculate child support is called “net disposable income.” To calculate a party’s net disposable income, sometimes also referred to as “income available for support,” the court begins with a party’s gross income. For ordinary employed parties, this can usually be determined by looking at the individual’s W-2 and most recent pay stub. The Pennsylvania support rules then require that the following amounts be deducted from the party’s gross income: federal income taxes, Social Security taxes, Medicare taxes, state income taxes, local income taxes, mandatory retirement, union dues. While the rules provide for some other minor deductions, the deductions listed here are the primary, widely-applicable deductions.
The federal income tax deduction is an area where there can be wide variation in the calculation. This is because this deduction should reflect a party’s actual federal income tax liability, which itself has many factors that can influence it. Therefore, to accurately calculate this deduction, it is helpful to have a full view of a party’s financial situation. This calculation can become a very critical factor in cases where a party is a high earner, owns a business, or otherwise has complex income.
After calculation of all of the above is complete and the deductions are taken from a party’s gross income, the result is the party’s net disposable income. It is this figure that is income available for child support and the number upon which the support award will be based. The lower one’s income available for support is, the lower his or her child support obligation will be or, conversely, the higher the child support from the other parent will be. In Pennsylvania, child support is income-driven. This means that it is presumed that your child support should take priority over any other financial obligations and, therefore, a party’s expenses are largely irrelevant to the calculation of a support award. How expenses might affect a child support award will be addressed in the third part of this series.