If you are going through the divorce process and have children, you have likely thought through the child support process. When calculating your post-divorce budget, you should begin to factor in these periodic payments from the non-custodial parent. But how much should you expect from the non-custodial parent once the divorce proceedings are finished?
Child support guidelines vary by state, but the payment calculation is based on one of three different formulas: income share model, percentage of income model and the Melson formula.
Income Share Model
The majority of states use the income share model to calculate child support. In this model, the court summarizes the parents’ income and the number of children to determine the final child support amount.
For example, if the custodial parent of two children makes $2,500 each month and the non-custodial parent makes $5,000 each month, the court would calculate the monthly income as $7,500. Then, they would look at their state’s child support guidelines calculation table, which determines the expected cost of raising a child in their location. After the table determines that the monthly cost for two children is a hypothetical $2,000, the court would then find the percentages of each parents’ income. In this situation, the custodial parent makes 33 percent of the total income and the non-custodial parent makes up the remaining 66 percent. Therefore, each month, the non-custodial parent would pay $1,320 each month for child support, which is 66 percent of the monthly cost for raising two children.
Percentage of Income Model
A few states use the percentage of income model to calculate child support payments. This bases the payment amount on percentages of the non-custodial parent’s gross or net income, as well as the number of children in the family, as a divorce attorney can explain. This percentage can either be flat, where the amount remains the same even if the non-custodial parent’s income shifts; or varying, where the amount fluctuates with income. In this model, only the income of the non-custodial parent is considered.
For example, if the child support percentage for two children is 25 percent, the non-custodial parent making a net amount $5,000 would pay $1,250 each month for child support.
Three states, Montana, Hawaii, and Delaware, use the Melson Formula. This formula is a little more complicated as it involves income, the needs of the child, and a base standard of living adjustment for the child. However, the basis of the formula is similar to the income shares model, as the amount paid by the non-custodial parent fluctuates based on the income of both parents.