Recent Changes to the Michigan Child Support Formula

When a couple gets divorced and children are involved, two main issues must be decided regarding the children: child custody and child support. Even in instances of joint custody, a spouse that earns significantly greater income may be required to pay child support in order to ensure that the children continue to enjoy the same lifestyle in both households.

Naturally, calculating child support is a complicated process and there are several factors involved in determining exactly how much a parent is required to pay. In the state of Michigan, a number of amendments to the existing formula went into effect as of January 1, 2017. Here is a brief rundown of the biggest changes.

High Income
A rule regarding instances of “extremely high income” has replaced the former “magnitude of income deviation factor” in calculating the amount of child support. Under this new rule, the court has the discretion to deviate from the general care tables in cases where income is at least several times larger than the greatest income listed.

Generally speaking, child care is assigned based on the needs of children, to ensure that they have access to all forms of proper care (housing, utilities, nutrition, medical care, and so on). Although there is no set definition for “extremely high income” provided, courts are given the latitude to determine when cases fall under this heading.

Parental Time Offset
The amount of time each parent spends caring for children has always been a factor in determining the amount of child support payments, but the offset has been altered and is now calculated at a factor of 2.5 to ensure that payments better reflect the overall costs of the parent receiving child support, including greater time spent involved in parenting.

Mandatory Healthcare
Under the Affordable Care Act (ACA), or Obamacare, maintaining health insurance coverage is mandatory. Because of this, out-of-pocket expenses for health insurance (whether purchased through an employer-sponsored plan, a state health insurance exchange, or the private market) may be deducted from income eligible for child support payments.

Medical Expenses
It’s not inconceivable that one parent will incur significantly more medical costs related to children than the other. Or perhaps the costs incurred are relatively equal, but the parent paying child support is virtually paying twice (once to doctors and once to the ex-spouse through calculated child support payments). The rules regarding payments considered “additional” medical expenses have been amended to read “additional extraordinary” expenses and the threshold has changed.

Retirement Contributions
Under new rules, parents paying child support may only deduct mandatory contributions to employer-sponsored retirement plans. The previous deduction of 5.5% for voluntary contributions to retirement accounts is no longer available since a parent is making a decision about how to spend income that would otherwise be available for child support.

Understanding how child support is calculated can be daunting. The family law attorneys at The Gucciardo Law Firm are uniquely qualified to help you with any and all matters concerning child support calculations and payments. Contact us today at (248) 723-5190 to find out what we can do for you.