I am going to let you know right up front: This part of family law is way more complicated than it needs to be. And, if I am being honest, dealing with matters of support is very frustrating. So, I am going to try and explain the concepts that you need to know in order to understand Pennsylvania Support.
The first thing that you need to do is separate in your mind the concepts of child support and spousal support. This is because in Pennsylvania the concepts are intertwined in the statutory equation that kicks out the applicable figures. Confused yet? Let me add another layer in case you are still with me: The concept of spousal support and the math that is applicable to it is also referred to as Alimony Pendente Lite and/or Alimony, depending on the stage of the proceeding.
So, if a couple separates and no divorce is filed, but one spouse files for support, the support is considered spousal support because the parties are still spouses and no divorce proceeding has been filed. Now, after that couple’s support matter is heard, let’s assume that one of them now files for divorce. At that particular moment in time, due to the fact of the filing, the amount of money that was once known as spousal support is now regarded as alimony pendente lite. And, to play it through for you, as the divorce matter comes to a close the spouses will need to talk about whether or not Alimony will be paid. Alimony is the sum of money that one spouse pays to another after the divorce decree has been entered. And, while sometimes the amount of alimony is based on spousal support and/or APL, sometimes it is not. And, if the parties cannot agree on alimony, then a master can be used to come up with an alimony figure.
The concept of spousal support / APL is relevant here because in 2019 its tax treatment changed because payment of alimony was no longer allowed to be deducted by the payor. Without getting into too much of the tax talk, as a result of this change the payments are no longer deductible by the payor; and, the receipt of that money is no longer taxable income. As a result of this, the Pennsylvania formula changed.
As a result of the Pennsylvania formula change, the estimation of support / APL is used to reduce the net income of the payor and increase the income of the payee, which has the effect of reducing the share the payor has towards obligations that are not included in the basic child support formula.
Tax consideration – you need to be aware that there could be tax implications for modifying an order pertaining to Alimony because it could cause the order to be treated differently. So, if you are thinking of modifying a pre-2019 order, you should talk to an attorney and tax professional.
You would think that the powers that be would try and keep formulas like this simple, given how important it is to get fair figures for these matters. Think again.
So, what is my suggestion for attacking this issue? The first thing is to understand as best you can the concepts that I have detailed. Otherwise, you are going to look at the formula and be confused. The second thing that you should do is to take a look at the statutory formula, which is available here. If you are like me and need some further assistance, the next place that you should go is to the Pennsylvania Child Support Program, which has a child support estimator (however, be aware that this does not kick out spousal support / APL numbers) which is free.
So, to sum it up … In light of the 2019 tax changes, the Pennsylvania method for calculating support changed to offset the effect of the tax change. So, now spousal support / APL calculations (which is an estimation) are done at the outset because that figure will affect the net incomes of the parties in the subsequent child support calculation. And, to determine which calculation to use you will need to know if there is a current custody order. The support / APL estimati0ns would thus go like this: IF couple has minor children then the obligor’s net income would be multiplied by .25 AND then subtract the obligee’s portion (net income x .30); IF couple HAS NO minor children, then the obligor’s net income would be multiplied by .33 and the obligee’s net income would be multiplied by .40, followed by obligor’s figure subtracted by obligee’s figure.
EXAMPLE: Obligor has 2500 in income and obligee has 1000. Obligor and obligee have children. Therefore, before getting to the child support calculation, compute the spousal support / APL. This calculation would go like this (2500 x .25) – (1000 x .30) —> 625 – 300 = 325 support /APL figure.