Every year there are (MCSF) Michigan Child Support Formula updates that determines how child support is calculated. Highland family law attorney Kathryn Wayne-Spindler recently attended the Institute of Continuing Legal Education Family Law Conference and came away with the article, “The 10 Things You Didn’t Know About Child Support, Period!”

In general, the courts calculate child support based on the income of both parents and the number of overnights each parent has with the children. Here some highlights of the 2017 changes to income calculation for the purposes of child support:

Michigan Child Support Formula Updates

Retirement Payments

The income formula exempts retirement payments. This avoids double-dipping when the employee already had the retirement contribution included in income.

“Employer contributions to retirement plans are no longer considered income for purposes of calculating support,” according to the Family Law Institute materials written by Friends of the Court Barbara J. Kelly and Traci L. Rink. Mandatory employee pension contributions are deductible but voluntary contributions are not.

Employer-Provided benefits

Usually, any employee benefits that reduce a parent’s living expenses, would be included as income. New this year however, tuition and educational cost reimbursements, uniforms and HSA (health savings account) changes are not included as income. The ICLE materials provided at the conference cite MCSF 2.01 (D).

Self-Employed Individuals and Business Owners

According to the ICLE Materials, the important change for Business-owners’ income calculations, is “that real estate depreciation should always be added back into a parent’s income when calculating support.”

Imputed Income

Imputed Income, or potential income, is used for child support calculations. It is used in cases where one or both of the parents are voluntarily unemployed or underemployed. The imputation factor allows courts to consider what each person could be earning when looking at income calculations.

The 2013 Michigan Child Support Formula Manual lists the following factors used for calculating imputed income:

1. (a)  Prior employment experience and history, including reasons for any termination or changes in employment.
2. (b)  Educational level and any special skills or training.
3. (c)  Physical and mental disabilities that may affect a parent’s ability to obtain or maintain gainful employment.
4. (d)  Availability for work (exclude periods when a parent could not work or seek work, e.g., hospitalization, incarceration, debilitating illness, etc.).
5. (e)  Availability of opportunities to work in the local geographical area.
6. (f)  The prevailing wage rates in the local geographical area.
7. (g)  Diligence exercised in seeking appropriate employment.
8. (h)  Evidence that the parent in question is able to earn the imputed income.
9. (i)  Personal history, including present marital status and present means of support.
10. (j)  The presence of the parties’ children in the parent’s home and its impact on that parent’s earnings.
11. (k)  Whether there has been a significant reduction in income compared to the period that preceded the filing of the initial complaint or the motion for modification.

The imputation calculator was overhauled in 2008 but there are a few Michigan Child Support Formula updates for 2017. Most importantly, the formula considers the number of hours of available work in the local geographical area. This takes into account a previously-existing, possibly-unrealistic expectation that anyone should be able to find full-time work even though employers tend to prefer part-time positions so they can avoid providing benefits.

The formula emphasizes that each individual should be considered independent of the “generalized assumptions” of the general population with similar work and education backgrounds.

Income Deduction for Mandatory Health Care Expenses

If mandatory health care is required for the parent, that expense can be deducted from the parent’s income.

For the most up-to-date Michigan Child Support Formula updates and income calculation factors, contact the law office of Kathryn Wayne-Spindler & Associates at 248-676-1000. Our attorneys have many years of family law experience as well as countless hours of continuing legal education to provide comprehensive counsel regarding child support expectations. The Milford, Michigan attorneys represent clients going through divorce as well as those seeking post-judgment modifications after the divorce is final. We handle cases throughout Southeastern Michigan including Oakland, Wayne, Washtenaw, Genesee and Livingston counties. We represent clients in Milford; Hartland; Highland; Commerce; Walled Lake; White Lake; Wixom; Waterford; West Bloomfield; Howell; South Lyon; New Hudson; Grand Blanc; Holly; Linden and many more local communities.

Written and posted by Christine Donlon Long, Communications’ Specialist for Kathryn Wayne-Spindler & Associates