[35 Pa.B. 5643]
[Continued from previous Web Page]
[Explanatory Comment--2000 The chart of proportional expenditures, formerly Rule 1910.16-3(b), was duplicative and is rescinded. The basic child support schedule, formerly Rule 1910.16-3(a), is now Rule 1910.16-3.]
Explanatory Comment--2005 The schedule has been amended to reflect updated economic data. See Explanatory Comment--2005 following Rule 1910.16-1.
Rule 1910.16-4. Support Guidelines. Calculation of Support Obligation. Formula.
(a) The following formula shall be used to calculate the obligor's share of the basic guideline child support, spousal support and/or alimony pendente lite obligation:
PART I. BASIC CHILD SUPPORT
OBLIGOR OBLIGEE 1. Total Gross Income [per pay period] Per Pay Period ______ ______ * * * * * 6. Plus Child's Monthly Social Security Death, Retirement or Disability Derivative Benefit, if any. (See Rule 1910.16-2(b)(2)) + * * * * *
8. PRELIMINARY BASIC CHILD SUPPORT OBLIGATION (determined from [Schedule] schedule at Rule 1910.16-3 based on number of children and line 7 adjusted combined monthly net income) ______ 9. Less Child's Monthly Social Security Derivative Benefit ( ) * * * * *
11. Net Income Expressed as a Percentage Share of Income ([Divide] divide line 4 by line 5 and multiply by 100) % % 12. Each Parent's Monthly Share of the Basic Child Support Obligation ([Multiply] multiply line 10 and 11) ______ ______ PART II. SUBSTANTIAL OR SHARED PHYSICAL CUSTODY ADJUSTMENT, IF APPLICABLE (See subdivision (c) of this [Rule] rule)
13. a. Percentage of Time Spent with Children ([Divide] divide number of overnights with obligor by 365 and multiply by 100) % b. Subtract 30% ( 30%) c. Obligor's Adjusted Percentage Share of the Basic Monthly Support Obligation ([Subtract] subtract line 13b from line 11) % d. Obligor's Adjusted Share of the Basic Monthly Support Obligation ([Multiply] multiply line 13c and line 10) ______ e. Further adjustment, if necessary under subdivision (c)(2) of this [Rule] rule ______ PART III. ADDITIONAL EXPENSES (See Rule 1910.16-6)
14. a. Obligor's [share of child care expenses] Share of Child Care Expenses ______ b. Obligor's [share of health insurance premium] Share of Health Insurance Premium (if the obligee is paying the premium) ______ c. Less [obligee's share of the health insurance premium] Obligee's Share of the Health Insurance Premium (if the obligor is paying the premium) ( ) d. Obligor's [share of unreimbursed medical expenses] Share of Unreimbursed Medical Expenses ______ e. Other [additional expenses] Additional Expenses ______ f. Total Additional Expenses ______ 15. OBLIGOR'S TOTAL MONTHLY SUPPORT OBLIGATION ([Add] add line 12 or 13[(d) or (e)] d or e (if applicable) and line 14f) ______ PART IV. SPOUSAL SUPPORT OR APL
With Dependent Children
16. Obligor's Monthly Net Income (line 4) ______ 17. Less Obligor's [support, alimony pendente lite or alimony obligations] Support, Alimony Pendente Lite or Alimony Obligations, if any, to [children or former spouses] Children or Former Spouses who are not part of this action ([See] see Rule 1910.16-2(c)(2)) ( ) * * * * *
20. Less Obligor's Total Monthly Child Support Obligation Without Part II Substantial or Shared Custody Adjustment (Obligor's line [15] 12 plus line 14f) ( ) * * * * * Without Dependent Children * * * * * 25. Less Obligor's [support, alimony pendente lite or alimony obligations] Support, Alimony Pendente Lite or Alimony Obligations, if any, to [children or former spouses] Children or Former Spouses who are not part of this action ([See] see Rule 1910.16-2(c)(2)) ( ) * * * * * 30. Adjustments for [other expenses] Other Expenses ([See] see Rule 1910.16-6) ______ * * * * * (c) Substantial or Shared Physical Custody.
(1) [The support guidelines contemplate that the obligor has regular contact, including vacation time, with his or her children, and that he or she makes direct expenditures on behalf of the children.] When[, however,] the children spend 40% or more of their time during the year with the obligor, a rebuttable presumption [exists] arises that the obligor is entitled to a reduction in the basic support obligation to reflect this [additional] time. Except as provided in subsections (2) and (3) below, the reduction shall be calculated pursuant to the formula set forth in Part II of subdivision (a) of this [Rule] rule. For purposes of this provision, the time spent with the children shall be determined by the number of overnights they spend during the year with obligor.
Example. Where the obligor and the obligee have monthly net incomes of $5,000 and $2,300 respectively, their combined child support obligation is $[1,784] 1,548 for two children. Using the income shares formula in Part I, the obligor's share of this obligation is 68%, or $[1,213] 1,053. If the children spend 40% of their time with the obligor, the formula in Part II applies to reduce his or her percentage share of the combined support obligation to 58%, or $[1,034] 898. If the children spend 45% of their time with the obligor, his or her percentage share of the combined obligation is reduced to 53%, or $[945] 820. If the children spend equal time with both parents, the obligor's percentage share is reduced to 48%, or $[856] 743.
(2) Without regard to which parent initiated the support action, when the children spend equal time with both parents, the Part II formula cannot be applied unless the obligor is the parent with the higher income. In no event shall an order be entered requiring the parent with the lower income to pay basic child support to the parent with the higher income. However, nothing in this subdivision shall prevent the entry of an order requiring the parent with less income to contribute to additional expenses pursuant to Rule 1910.16-6. Pursuant to either party's initiating a support action, the trier of fact may enter an order against either party based upon the evidence presented without regard to which party initiated the action. If application of the formula in Part II results in obligee receiving a larger share of the parties' combined income in cases in which the parties share custody equally, then the court shall adjust the support obligation so that the combined income is allocated equally between the two households.
Example 1. Mother and Father have monthly net incomes of $3,000 and $[2,000] 2,700 respectively. Mother has filed for support for the parties' two children with whom they share time equally. Pursuant to the Basic Child Support Schedule at Rule 1910.16-3, the support amount for two children at their parents' combined net income level is $[1,335] 1,302 per month. Mother's share is [60%] 53% of that amount, or $[801] 690. Father's share is [40%] 47%, or $[534] 612. Application of subdivisions a. and b. of the Part II formula results in a 20% reduction in support when each parent spends 50% of the time with the children. Because the parties share custody equally, Mother cannot be the obligee for purposes of the Part II calculation because she has the higher income of the two parents. In these circumstances, although Mother initiated the support action, she would become the obligor even if Father has not filed for support. Father cannot be an obligor in the Part II calculations, nor can the amount of support Mother is obligated to pay to Father be offset by calculating Father's adjusted amount of support under Part II, because a support order cannot be entered against the parent with the lesser income. Using Mother as the obligor, her adjusted percentage share of the basic support amount is [40%] 33% ([60%] 53% - 20% = [40%] 33%). Her adjusted share of the basic support amount is $[534] 430 ([40%] 33% of $[1,335] 1,302). However, instead of $[534] 430 per month, Mother's support obligation would be adjusted to $[500] 150 per month to allocate the parties' combined income equally between the two households. This is the [presumptively correct] presumptive amount of basic support payable to Father under these circumstances.
Example 2. Where the obligor and the obligee have monthly net incomes of $3,000 and $2,500 respectively, their combined child support obligation for two children is $1,268. The obligor's share of this obligation is 55%, or $697. If the children spend equal time with both parents, the formula in Part II results in a support obligation of $444 payable to the obligee. Since this amount gives the obligee $2,944 of the combined income, and leaves the obligor with only $2,556 of the combined income, the obligor's support obligation must be adjusted to $250 to equalize the combined income between the parties' households. This is the presumptive amount of basic support payable to obligee under these circumstances.
* * * * * (d) Divided or Split Physical Custody.
(1) When calculating a child support obligation, and one or more of the children reside with each party, the court shall offset the parties' respective child support obligations and award the net difference to the obligee as child support. For example, if the parties have three children, one of whom resides with [Husband] Father and two of whom reside with [Wife] Mother, and their net monthly incomes are $1,500 and $800 respectively, [Husband's] Father's child support obligation is calculated as follows. Using the formula with the schedule in Rule 1910.16-3 for two children, [Husband's] Father's support obligation for the two children living with [Wife] Mother is $[508] 513. Using the formula with the schedule in Rule 1910.16-3 for one child, [Wife's] Mother's support obligation for the child living with [Husband] Father is $[188] 199. Subtracting $[188] 199 from $[508] 513 produces a net basic support amount of $[320] 314 payable to [Wife] Mother as child support.
(2) When calculating a combined child support and spousal or [APL] alimony pendente lite obligation, and one or more children reside with each party, the court shall, except as set forth in subdivision (3) below, offset the obligor's spousal and child support obligation with the obligee's child support obligation and award the net difference to the obligee as spousal and child support.
(3) When one or more of the children resides with each party and the obligee's net income is 10% or less of the parties' combined net monthly income, then, in calculating the spousal support or [APL] alimony pendente lite obligation, the court shall deduct from the obligor's income both the support owed for the child or children residing with the obligee, as well as the direct support the obligor provides to the child or children living with the obligor, calculated in accordance with the guidelines as if the child or children were not living with the obligor.
(e) Support Obligations When Custodial Parent Owes Spousal Support. Where children are residing with the spouse obligated to pay spousal support or alimony pendente lite (custodial parent) and the other spouse (non-custodial parent) has a legal obligation to support [these] the children, the guideline amount of spousal support or alimony pendente lite shall be determined by offsetting the non-custodial parent's obligation for support of the children and the custodial parent's obligation of spousal support or alimony pendente lite, and awarding the net difference either to the non-custodial parent as spousal support/alimony pendente lite or to the custodial parent as child support as the circumstances warrant.
The following example uses the formula to show the steps followed to determine the amount of the non-custodial parent's support obligation to the children and the effect of that obligation upon the custodial parent's spousal support obligation. The example assumes that the parties have two children and the non-custodial parent's net monthly income is $1,000 and the custodial [parent to the non-custodial] parent's net monthly income is $2,600. First, determine the spousal support obligation of the custodial parent to the non-custodial parent based upon their net incomes from the formula for spousal support without dependent children, i.e., $640. Second, recompute the net income of the parties assuming the payment of the spousal support so that $640 is deducted from the custodial parent's net income, now $1,960, and added to the non-custodial parent's net income, now $1,640. Third, determine the child support obligation of the non-custodial parent for two children, i.e., $[468] 501. Fourth, determine the recomputed support obligation of the custodial parent to the non-custodial parent by subtracting the non-custodial parent's child support obligation from Step 3 ($[468] 501) from the original support obligation determined in Step 1 ($640). The recomputed spousal support is $[172] 139.
(f) Allocation. Consequences.
(1) An order awarding both spousal and child support may be unallocated or state the amount of support allocable to the spouse and the amount allocable to each child. However, the formula provided by these rules [assume] assumes that an order will be unallocated. Therefore, if the order is to be allocated, the formula set forth in this [Rule] rule shall be utilized to determine the amount of support allocable to the spouse. If allocation of an order utilizing the formula would be inequitable, the court shall make an appropriate [allocation] adjustment. Also, if an order is to be allocated, an adjustment shall be made to the award giving consideration to the federal income tax consequences of an allocated order as may be appropriate under the circumstances. No consideration of federal income tax consequences shall be applied if the order is unallocated or the order is for the spousal support or alimony pendente lite only.
Official Note: The 2005 amendment supersedes Diament v. Diament, 816 A.2d 256 (Pa. Super. Ct. 2003), to the extent that it held that the tax savings from payments for the benefit of a spouse alone or from an unallocated order for the benefit of a spouse and child must be considered in determining the obligor's available net income for support purposes. Rule 1910.16-4(f)(1) states that the guidelines formula assumes that the order will be unallocated. The tax consequences of an order for a spouse alone or an unallocated order for the benefit of a spouse and child have already been built into the formula.
* * * * * (4) In the event that the obligor defaults on an unallocated order, the court shall allocate the order for collection of child support pursuant to the Internal Revenue Service income tax refund intercept program or for registration and enforcement of the order in another jurisdiction under the Uniform Interstate Family Support Act, 23 Pa.C.S.A. § 7101 et seq. The court shall provide notice of allocation to the parties.
Official Note: This provision is necessary to comply with various state and federal laws relating to the enforcement of child support. It is not intended to affect the tax consequences of an unallocated order.
[Explanatory Comment--1998 Former Rule 1910.16-4 listed the factors for deviation from the support guidelines. Those factors now appear in Rule 1910.16-5. New Rule 1910.16-4(a) sets forth the income shares formula used to establish the support obligation and consolidates the provisions which formerly appeared in Rule 1910.16-5 relating to use of the formula in special situations. The formula itself has been revised only to conform to the new schedule in Rule 1910.16-3.
Subdivision (b) incorporates former Rule 1910.16-5(e) relating to orders for more than four children. It has been changed only to reflect the expansion of the guidelines from four to six children and the use of the schedule in lieu of the grids.
Subdivision (c) sets forth the method for calculating the presumptively correct amount of support in cases where the obligor spends a substantial amount of time with the children. The method is essentially this: when the obligor spends 40% or more time with the children, his or her percentage share of the combined basic support obligation is reduced by the percentage of time spent over and above the routine partial custody/visitation arrangement. For purposes of applying this method, the Committee has designated 30% time as the routine arrangement and 40% time as the level at which the parties' expenses begin to change significantly enough to warrant a reduction in the basic support obligation. When there is equal time sharing, subsection (2) reduces the support obligation further so that the obligor does not pay more than what is necessary to spread the parties' combined income equally between the two households. Subsection (3) expressly excludes CAM cases from application of this rule. Since the CAM already reduces support to a minimal level, no further reduction should be given for the amount of time spent with the children.
Subdivision (d) is derived from previous Rule 1910.16-5(h) relating to divided or split custody cases. The new provision has been rewritten to update the examples in conformity with the new levels of child support reflected in the schedule. It retains the existing method for offsetting the parties' respective support obligations when one or more of the children reside with each party, but eliminates the exception which previously existed in cases where one party's income was minimal and the other party's income was significantly greater. This exception was confusing as well as erroneous in its suggestion that offsetting should not be used because it would result in less than the full guideline amount of child support being paid to the party with minimal income. To the contrary, the offset method actually works to protect against this result and therefore should be used in these cases.
Subdivision (e) incorporates the substance of former Rule 1910.16-5(j) governing spousal support obligations when the custodial parent owes spousal support. It has been rewritten for greater clarity and the examples have been updated to reflect the new levels of child support and the use of the new schedule.
Subdivision (f)(1) and (2) incorporate verbatim the provisions which formerly appeared in Rule 1910.16-5(f). The guidelines continue to presume that the order will be unallocated for tax purposes. Subsection (3) is new, however, and provides for administrative allocation of the order in two instances: 1) when the obligor defaults on the order and it becomes necessary to collect support by intercepting any income tax refunds that may be due and payable to obligor and 2) when the obligor defaults and the order must be registered in another state under the Uniform Interstate Family Support Act (UIFSA). As the note indicates, this administrative allocation is not intended to affect the tax consequences of the unallocated order.
Explanatory Comment--2000 Subdivision (3) is new and the former subdivision (3) has been renumbered as subdivision (4). The new language is intended to insure alimony tax treatment of unallocated orders pursuant to § 71 of the Internal Revenue Code. A similar change has been made to the form order at Rule 1910.27(e). New Rule 1910.19(d) provides that all spousal support and alimony pendente lite orders terminate upon the death of the payee. Termination of a charging order does not affect arrears existing at that time.
Explanatory Comment--2002 The amendments to this rule add lines in the formula to facilitate calculation of child support pursuant to Rule 1910.16-2(b)(2) when the child is receiving Social Security derivative benefits due to a parent's retirement or disability. A new line also was added to include additional expenses authorized by Rule 1910.16-6 in cases involving spouses only.]
Explanatory Comment--2005 Rule 1910.16-4(a) sets forth the income shares formula used to establish the support obligation. Subdivision (b) provides the method for calculating support for seven or more children as the basic support schedule in Rule 1910.16-3 sets forth the presumptive amount of support for only up to six children.
Subdivision (c) sets forth the method for calculating the presumptive amount of support in cases where the children spend 40% or more of their time during the year with the obligor. When there is equal time sharing, subsection (2) reduces the support obligation further so that the obligor does not pay more than is necessary to equalize the parties' combined income between the two households. Subsection (3) expressly excludes SSR cases from application of this rule. Since the SSR already reduces support to a minimal level, no further reduction should be given for the amount of time spent with the children.
Subdivision (d) relates to the calculation of support in divided or split custody cases. It retains the existing method for offsetting the parties' respective support obligations when one or more of the children resides with each party.
Subdivision (e) governs spousal support obligations when the custodial parent owes spousal support. It has not been amended, other than to update the example to be consistent with the new schedule at Rule 1910.16-3.
In subdivision (f), the guidelines continue to presume that the order will be unallocated for tax purposes. However, new language has been added to subsection (f)(1), and a new Note has been inserted, to clarify that an obligor's tax savings from payment of a spousal support order or an unallocated order for a spouse and child should not be considered in calculating the obligor's available net income for support purposes. Subsection (3) is intended to insure alimony tax treatment of unallocated orders pursuant to § 71 of the Internal Revenue Code. Rule 1910.19(d) provides that all spousal support and alimony pendente lite orders terminate upon the death of the payee. Termination of a charging order does not affect arrears existing at that time. Subsection (4) provides for administrative allocation of the order in two instances: 1) when the obligor defaults on the order and it becomes necessary to collect support by intercepting any income tax refunds that may be due and payable to obligor; and 2) when the obligor defaults and the order must be registered in another state under the Uniform Interstate Family Support Act (UIFSA). As the Note indicates, this administrative allocation is not intended to affect the tax consequences of the unallocated order.
Rule 1910.16-5. Support Guidelines. Deviation.
(a) Deviation. If the amount of support deviates from the amount of support determined by the guidelines, the trier of fact shall specify, in writing, the guideline amount of support, and the reasons for, and findings of fact justifying, the amount of the deviation.
* * * * * (b) Factors. In deciding whether to deviate from the amount of support determined by the guidelines, the trier of fact shall consider:
* * * * * (c) Duration. In determining the duration of an award for spousal support or alimony pendente lite, the trier of fact shall consider the period of time during which the parties lived together from the date of marriage to the date of final separation.
Explanatory Comment--[1998 ] 2005 [As part of the overall reorganization of the support rules, the provisions which formerly appeared in Rule 1910.16-5 have been moved elsewhere. New Rule 1910.16-5 incorporates former Rule 1910.16-4 setting] Rule 1910.16-5 sets forth the factors for deviation from the [presumptively correct] presumptive amount of support. Subdivision (c) and subsection (b)(8) [was added to] permit the court to consider the length of the marriage in determining the amount and duration of a spousal support or alimony pendente lite [case] award. The primary purpose of [this provision] these provisions is to prevent the unfairness that arises in a short-term marriage when the obligor is required to pay support over a substantially longer period of time than the parties were married and there is little or no opportunity for credit for these payments at the time of equitable distribution.
Rule 1910.16-6. Support Guidelines. Adjustments to the Basic Support Obligation.
(a) Child care expenses. Reasonable child care expenses paid by [the custodial] either parent, if necessary to maintain employment or appropriate education in pursuit of income, [are the responsibility of both parents. These expenses] shall be allocated between the parties in proportion to their net incomes and [obligor's share] added to his [or] and her basic support obligation. When [the custodial] a parent is receiving a child care subsidy through the Department of Public Welfare, the expenses to be allocated between the parties shall be the full unsubsidized cost of the child care, not just the amount actually paid by the [custodial] parent receiving the subsidy. However, if allocation of the unsubsidized amount would result in a support order that is overly burdensome to the obligor, deviation pursuant to Rule 1910.16-5 may be warranted.
Example. Mother has primary custody of the parties' two children and Father has partial custody. Mother's monthly net income is $2,000 and Father's is $3,500. At their combined income level of $5,500, the basic monthly child support from the schedule in Rule 1910.16-3 is $1,268 for two children. As Father's income is 64% of the parties' combined income, his share is $812. Mother incurs child care expenses of $400 per month and Father incurs $100 of such expenses each month. The total amount of child care expenses, $500, will be apportioned between the parties, with Father paying 64%, or $320. As he is already paying $100 for child care while the children are in his partial custody, he would pay the remaining $220 to Mother for a total child support obligation of $1,032 ($812 + $220 = $1,032).
(1) Except as provided in subsection (2), the total child care expenses shall be reduced to reflect the amount of the federal child care tax credit available to the [custodial] eligible parent, whether or not the credit is actually claimed by that parent, up to the maximum annual cost allowable under the Internal Revenue Code.
(2) The federal child care tax credit shall not be used to reduce the child care expenses subject to allocation between the parties if the [custodial] eligible parent is not qualified to receive the credit.
Official Note: A child care subsidy provided by the Department of Public Welfare should not be used to reduce the child care expenses subject to allocation between the parties to the extent that the obligor has the financial resources to contribute to the actual costs of child care. Nor is it appropriate to order the obligee to seek a child care subsidy in order to reduce the obligor's share of child care expenses if the obligor has the financial ability to contribute to those expenses. While public policy requires that parents, rather than taxpayers, pay for their children's child care when they are able to do so, allocation of the full unsubsidized cost of child care may result in a support order that is overly burdensome to the obligor. In those circumstances, in addition to considering deviation to relieve the burden on the obligor, the trier of fact also has the discretion to determine whether or not to include in the order other adjustments under Rule 1910.16-6, such as a mortgage contribution, which are not mandatory. No adjustment to the [basicsupport] basic support amount shall be permitted if such would cause the obligor's remaining net monthly income to fall below the [Computed Allowance Minimum (CAM) of $550] Self-Support Reserve of $748. Implicit in the rule requiring apportionment of the unsubsidized cost of child care is recognition of the duty of the subsidy recipient to report any additional income pursuant to Department of Public Welfare regulations so that adjustments can be made to entitlements accordingly.
* * * * * (c) Unreimbursed Medical Expenses. Unreimbursed medical expenses of the obligee or the children shall be allocated between the parties in proportion to their respective net incomes. Notwithstanding the prior sentence, there shall be no apportionment of unreimbursed medical expenses incurred by a party who is not owed a statutory duty of support by the other party. The court may direct that the obligor's share be added to his or her basic support obligation, or paid directly to the obligee or to the health care provider.
(1) For purposes of this subdivision, medical expenses are annual unreimbursed medical expenses in excess of $250 per person. Medical expenses include insurance co-payments and deductibles and all expenses incurred for reasonably necessary medical services and supplies, including but not limited to surgical, dental and optical services, and orthodontia. Medical expenses do not include cosmetic, chiropractic, psychiatric [or], psychological or other services unless specifically directed in the order of court.
Official Note: While cosmetic, chiropractic, psychiatric [and], psychological or other expenses are not required to be apportioned between the parties, the court may apportion such expenses that it determines to be reasonable and appropriate under the circumstances.
* * * * * (e) Mortgage Payment. The guidelines assume that the spouse occupying the marital residence will be solely responsible for the mortgage payment, real estate taxes, and homeowners' insurance. Similarly, the court will assume that the party occupying the marital residence will be paying the items listed unless the recommendation specifically provides otherwise. If the obligee is living in the marital residence and the mortgage payment exceeds 25% of the obligee's net income (including amounts of spousal support, [APL] alimony pendente lite and child support), the court [maydirect] may direct the obligor to assume up to 50% of the excess amount as part of the total support award. For purposes of this subdivision, the term ''mortgage'' shall include first mortgages, real estate taxes and homeowners' insurance and may include any subsequent mortgages, home equity loans and any other obligations incurred during the marriage which are secured by the marital residence.
[Explanatory Comment--1998 New Rule 1910.16-6 consolidates the provisions of former Rule 1910.16-5 governing the treatment of additional expenses that warrant an adjustment to the basic support obligation.
Subdivision (a) relating child care expenses substantially incorporates former subdivision (i) of Rule 1910.16-5 with two substantive changes. First, it changes the method of allocation from one of equal shares to proportionate shares based on the parties' net incomes. Second, it reflects the federal child care tax credit that is available to the custodial parent. This credit essentially reduces the total expenses subject to allocation. For tax purposes, the actual credit can range anywhere from 20 to 30 percent depending on the custodial parent's income. For support purposes, however, the Rule assumes an average tax credit of 25 percent. Although the court may always look at the actual tax rate that applies in a particular case, it will have very little impact on the overall support award.
There are two important limitations on the use of this tax credit. First, it applies only to the first $2,400 per year ($200 per month) for one child or $4,800 per year ($400 per month) for two or more children. Only child care expenses incurred up to these amounts, therefore, are reduced by 25% before allocating them between the parties. Any remaining expenses are allocated between the parties without adjustment. Second, since the tax credit may be taken only against taxes owed, it cannot be used when the custodial parent does not incur sufficient tax liability to fully realize the credit. For this reason, subsection (2) provides that no adjustment to the total child care expenses may be made if the custodial parent's gross income falls below the thresholds set forth therein. The income thresholds are based on 1997 tax rates.
Subdivision (b) reflects a major change in the treatment of health insurance premiums. Under the old rules, the cost of health insurance was deducted from the party's gross income to determine net income. Under the new Rule, this cost is now generally treated as an additional expense to be allocated between the parties in proportion to their net incomes. In addition, subsection (1) of the new Rule permits allocation of the entire premium, including the party's portion of the premium, when the insurance benefits the other party or the children. Subsection (2) provides for proration of the premium when the health insurance covers other persons who are not subject to the support action.
Subdivision (c) incorporates former Rule 1910.16-5(p) with four changes. First, since the first $250 of medical expenses per year per child is built into the basic guideline amount in the child support schedule, only medical expenses in excess of $250 per year per child are subject to allocation under this Rule as an additional expense to be added to the basic support obligation. Second, the Committee has chosen to draw this same line with respect to spousal support so that the obligee-spouse is expected to assume the first $250 per year of these expenses and may seek contribution under this Rule only for unreimbursed expenses which exceed $250 per year. The third change amends the definition of ''medical expenses'' to include insurance co-payments, deductibles and orthodontia and to exclude chiropractic services. The fourth change distinguishes between medical expenses which are recurring and predictable and those which are not. When the expenses are recurring and predictable, the court may establish a monthly amount for these expenses and add it to the basic support obligation so that it is collectible through wage attachment.
Subdivision (d) governs apportionment of private school tuition, summer camp and other unusual needs not reflected in the basic guideline amounts of support. Whereas the old rule required these expenses to be borne by the parties in reasonable shares, the new Rule presumes allocation in proportion to the parties' net incomes consistent with the treatment of the other additional expenses.
Explanatory Comment--2000 Subdivision (b) has been amended to permit an alternative method for dealing with the cost of health insurance premiums in certain circumstances. In general, the cost of the premiums will be treated as an additional expense to be allocated between the parties in proportion to their net incomes. However, in cases in which the obligee has no income or minimal income, new subsection (4) authorizes the trier of fact to reduce the obligor's gross income for support purposes by some or all of the amount of the health insurance premiums. Under this subdivision (b) as originally promulgated, the entire cost of health insurance would have been borne by the obligor when the obligee had little or no income, with no resulting reduction in the amount of support he or she would otherwise be required to pay under the support guidelines. The goal of the amendment to this subdivision is to encourage and facilitate the maintenance of health insurance coverage for dependents by giving the obligor a financial incentive to maintain health insurance coverage.
Subdivision (e) has been amended to correct a drafting error in the definition of ''mortgage''. It always was the intention of the Committee to include in the definition the real estate taxes and homeowners' insurance referenced in the first sentence of the rule. In addition, while real estate taxes and homeowners' insurance must now be included if the trier of fact applies the provisions of this subdivision, the inclusion of second mortgages, home equity loans and other obligations secured by the marital residence is within the discretion of the trier of fact based upon the circumstances of the case.]
Explanatory Comment--2005 Rule 1910.16-6 governs the treatment of additional expenses that warrant an adjustment to the basic support obligation.
Subdivision (a)[,] relates to child care expenses. Subdivision (a) has been amended to require that child care expenses incurred by either party are to be allocated between the parties in proportion to their respective net incomes. Subsection (a)(1), relating to the federal child care tax credit, [has been] was amended in 2004 to reflect recent amendments to the Internal Revenue Code. 26 U.S.C.A. § 21. By referring to the tax code in general, rather than incorporating current code provisions in the rule, any further amendments will be incorporated into the support calculation. Since the tax credit may be taken only against taxes owed, it cannot be used when the eligible parent does not incur sufficient tax liability to fully realize the credit. For this reason, subsection (2) provides that no adjustment to the total child care expenses may be made if the eligible parent does not qualify to receive the credit.
Subdivision (b) addresses health insurance premiums. The cost of the premiums is generally treated as an additional expense to be allocated between the parties in proportion to their net incomes. Subsection (1) of the rule permits allocation of the entire premium, including the portion of the premium covering the party carrying the insurance, when the insurance benefits the other party and/or the children. Subsection (2) clarifies that, in calculating the amount of the health care premium to be allocated between the parties, subdivision (b)(1) requires the inclusion of that portion of the health insurance premium covering the party who is paying the premium, so long as there is a statutory duty of support owed to that party, but not the portion of the premium attributable to non-parties and children who are not the subjects of the support order. Subsection (2) provides for proration of the premium when the health insurance covers other persons who are not subject to the support action or owed a statutory duty of support. Subdivision (b) also permits an alternative method for dealing with the cost of health insurance premiums in certain circumstances. While, in general, the cost of the premiums will be treated as an additional expense to be allocated between the parties in proportion to their net incomes, in cases in which the obligee has no income or minimal income, subsection (4) authorizes the trier of fact to reduce the obligor's gross income for support purposes by some or all of the amount of the health insurance premiums. This is to avoid the result under a prior rule in which the entire cost of health insurance would have been borne by the obligor, with no resulting reduction in the amount of support he or she would otherwise be required to pay under the support guidelines. The goal of this provision is to encourage and facilitate the maintenance of health insurance coverage for dependents by giving the obligor a financial incentive to maintain health insurance coverage.
Subdivision (c) deals with unreimbursed medical expenses. Since the first $250 of medical expenses per year per child is built into the basic guideline amount in the child support schedule, only medical expenses in excess of $250 per year per child are subject to allocation under this rule as an additional expense to be added to the basic support obligation. The same is true with respect to spousal support so that the obligee-spouse is expected to assume the first $250 per year of these expenses and may seek contribution under this rule only for unreimbursed expenses which exceed $250 per year. The definition of ''medical expenses'' includes insurance co-payments, deductibles and orthodontia and excludes chiropractic services.
Subdivision (d) governs apportionment of private school tuition, summer camp and other unusual needs not reflected in the basic guideline amounts of support. The rule presumes allocation in proportion to the parties' net incomes consistent with the treatment of the other additional expenses.
Subdivision (e) provides for the apportionment of mortgage expenses. It defines ''mortgage'' to include the real estate taxes and homeowners' insurance. While real estate taxes and homeowners' insurance must be included if the trier of fact applies the provisions of this subdivision, the inclusion of second mortgages, home equity loans and other obligations secured by the marital residence is within the discretion of the trier of fact based upon the circumstances of the case.
Rule 1910.16-7. Support Guidelines. Awards of Child Support When There are Multiple Families.
(a) When the total of the obligor's basic child support obligations equals fifty percent or less of his or her monthly net income, there will generally be no deviation from the guideline amount of support on the ground of the existence of a new family. For example, where the obligor requests a reduction of support for one child of the first marriage on the basis that there is a new child of the second intact marriage, and the relevant monthly net incomes are $[1,500] 2,500 for the obligor, $500 for the former spouse and $1,300 for the current spouse, the request for a reduction will be denied because the total support obligation of $[707] 1,142 ($[354] 601 for the first child and $[353] 541 for the second child) is less than half of the obligor's monthly net income.
(b) When the total of the obligor's basic support obligations exceeds fifty percent of his or her monthly net income, the court may consider a proportional reduction of these obligations. Since, however, the goal of the guidelines is to treat each child equitably, in no event should either a first or later family receive preference. Nor shall the court divide the guideline amount for all of the obligor's children among the households in which those children live.
Example 1. [Obligor] The obligor is sued for support of an out of wedlock child. [Obligor] The obligor is already paying support for two children of the first marriage, and has an intact second marriage with one child. The relevant monthly net incomes are $1,500 for the obligor, $1,100 for the former spouse, $0 for the current spouse and $1,500 for the parent of the new child. The guideline amounts for each family are $[504] 514 for the two children of the first marriage, $[359] 386 for the one child of the second marriage, and $[332] 362 for the one child out of wedlock for a total support obligation of $[1,195] 1,262. Since the total of these obligations exceeds fifty percent of the obligor's net monthly income of $1,500 per month, the court may consider a proportional reduction of all of the orders.
Example 2. [Obligor] The obligor is sued for support of three children of a second marriage. There is already an order in effect for two children of the first marriage. The relevant monthly net incomes are $1,000 for the obligor, $0 for the first spouse and $500 for the second spouse. The guideline amounts for each family are $[308] 229 for the two children of the first marriage and $[347] 422 for the three children of the second marriage for a total support obligation of $[655] 651. Since this total obligation leaves the obligor with only $[345] 349 on which to live, the order for the three children of the second family is too high. However, reducing the order for three children while leaving the existing order intact would give preference to the first family, contrary to the rule. Therefore, both orders must be reduced proportionally.
Example 3. [Obligor] The obligor is sued to establish orders for three children born out of wedlock. The net monthly incomes for the obligor and for each obligee is $1,500. The court would determine that the guideline figure for each child is $[322] 362 for a total obligation of $[966] 1,086 for three children. It would be incorrect to determine the guideline amount for three children, in this case $[664] 724, and then divide that amount among the three children.
(c) For purposes of this [Rule] rule, the [presumptively correct total] presumptive amount of the obligor's basic support [obligations] obligation is calculated using only the basic guideline amounts of support, as determined from the formula in Rule 1910.16-4, and does not include any additional expenses that may be added to these amounts pursuant to Rule 1910.16-6. In calculating the [presumptively correct total] presumptive amount of the obligor's basic support [obligations] obligation, the court should ensure that the obligor retains at least $[550] 748 per month consistent with Rule 1910.16-2(e).
Example 1. Assume that the obligor is paying $[291] 591 per month support for one child of the first marriage, plus an additional $[50] 200 per month for child care expenses. [Obligor] The obligor requests a reduction in this support obligation on the basis that there is one new child of the second intact marriage. The relevant incomes are $[1,200] 2,400 for the obligor and $0 for both the former and current spouses. [Obligor's] The obligor's request for a reduction should be denied because the total of the basic guideline obligations for both children is only $[582] 1,182 ($[291] 591 for each child) and this amount does not exceed 50% of the obligor's net monthly income. No reduction should be given on the basis that the obligor's contribution to child care expenses for the first child results in an overall support obligation of $[632] 1,382 which exceeds 50% of the obligor's net monthly income. Thus, the [presumptively correct] presumptive amount of basic support for the two children is still $[582] 1,182 ($[291] 591 for each child). The court must then consider the deviation factors under Rule 1910.16-5 and the [parties's] parties' respective contributions to additional expenses under Rule 1910.16-6 in arriving at an appropriate amount of total support for each child.
Example 2. Assume that the obligor is paying $[244] 227 per month support for one child of the first marriage. [Obligor] The obligor has one new child of the second intact marriage. The relevant incomes are $1,000 for the obligor and $0 for both the former and current spouses. No reduction should be given on the basis of the obligor's new child because the total of the basic guideline obligations for both children is only $[488] 454 ($[244] 227 for each child) and this amount does not exceed 50% of the obligor's net monthly income. Since, however, this amount leaves the obligor with only $[512] 546 per month, the court should proportionally reduce the support obligations so that the obligor retains $[550] 748 per month. Thus, the [presumptively correct] presump-tive amount of basic support for the two children is $[450] 252 ($[225] 126 for each child). The court must then consider the deviation factors under Rule 1910.16-5 and the parties' respective contributions to additional expenses under Rule 1910.16-6 in arriving at an appropriate amount of total support for each child.
(d) When an obligor is subject to more than one order for child support, spousal support and/or alimony pendente lite, the priority for distribution of payments and/or collections from the obligor, without regard to the source of the funds or method of collection, are as follows unless the court specifically orders a different distribution priority:
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Explanatory Comment--[1998] 2005 Rule 1910.16-7 has been amended to reflect the updated schedule at Rule 1910.16-3 and the increase in the Self-Support Reserve (''SSR''), formerly the CAM, to $748 per month. This [new Rule replaces former Rule 1910.16-5(n) relating to] rule sets forth the calculation of child support obligations in the context of multiple families. [It has been rewritten for clarity and to update the examples used to illustrate the method for calculating these obligations.] Awards of spousal support in this context are [now] addressed in Rule 1910.16-2(c)(2).
In determining whether the total support obligations exceed 50% of the obligor's net income to warrant a proportionate reduction of the child support orders, subdivision (c) [has been added to clarify] clarifies that the total consists only of the basic amounts of child support, as derived from the income shares formula in Rule 1910.16-4, and does not include additional expenses that may be added to these basic amounts under Rule 1910.16-6. As the first example illustrates, no reduction should be given if the basic support obligations do not exceed 50% of the obligor's net monthly income even though his or her contribution to additional expenses may result in an overall obligation exceeding this percentage of income. As the second example illustrates, however, in low income cases it may be necessary to adjust the child support obligations proportionally even though they do not exceed 50% of the obligor's net income. This is consistent with the goals of [CAM] the SSR to ensure that the obligor retains sufficient income to maintain the incentive to work so that he or she can support all of the children.
Subdivision (c) also emphasizes that the initial amounts which are calculated for purposes of determining whether a proportional reduction is warranted are only [presumptively correct] presumptive amounts of child support. They are subject to upward or downward adjustment under Rules 1910.16-5 and 1910.16-6 relating to deviation and additional child-related expenses which are typically added to the basic obligation. This is intended only to emphasize that the establishment of appropriate support obligations for children of different families involves the same considerations as the establishment of a support obligation for a child or children of a single family.
Subdivision (d) addresses the priority of the distribution of payments and collections. However, collections realized through the interception of federal tax returns by the Internal Revenue Service are subject to federal distribution priorities. See 45 CFR 303.72(h).
[Pa.B. Doc. No. 05-1893. Filed for public inspection October 14, 2005, 9:00 a.m.]
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