21 Jan How is Child Support Calculated?
The parent who will be ordered to pay child support is known as the obligor. The person who will receive child support is called the obligee.
To determine the amount of child support, the first thing that the court will do is determine obligor’s net resources. The following items are included in the calculation of net resources: all wage and salary income, all self-employment income, severance pay that is received, retirement pay, social security benefits that are received, unemployment benefits, disability and worker’s compensation benefits that are received, alimony, child support received for another child, net rental income, interest income, capital gains, trust distributions, annuity income, and gifts and prizes. The court will then subtract certain items. Some of the subtractions include, social security taxes, federal taxes (based on tax rate for a single person claiming one personal exemption and the standard deduction) , state taxes , union dues and the expenses for the cost of health insurance for obligor’s child. After the subtractions have been made the amount remaining is called obligor’s annual net resources. The court will then divide the annual net resources by 12 so that the court can determine obligor’s monthly net resources.
After the court determines the monthly net resources the court will multiply a percentage determined by the court toward obligor’s net resources. For example, the percentage for one child is 20% and if applied to monthly net resources of $1,000 means that obligor should pay $200 in child support.