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In the State of Maryland, parents who file for a divorce or custody can calculate child support obligations by using Maryland’s support guidelines. Although the basics of these guidelines are fairly simple, the details can be quite complicated. To gain a detailed understanding of these rules, you should reach out to us via phone. However, we can provide a basic treatment here in this blog post. This is an overview of how child support is calculated; we will include references to how a person’s income is determined for calculation purposes and also the basic model which Maryland uses to allocate payments.
Child Support - Income Shares Model
One of the main components of the Maryland child support system is the “income shares model.” This concept is how Maryland divides child support obligations between the two parties. The basic idea is to divide the financial obligations according to the gross earnings of each spouse. In other words, if we combine the earnings of both parties into a single amount, the obligation of each parent will remain proportionate to their contribution to the combined amount.Consider an example: one party earns $4,000 per month, while the other party earns $2,000 per month. If we do the math, we can see that the parent earning $4,000 per month will shoulder approximately 67% of the support responsibilities, and the other parent will shoulder roughly 33% of the responsibilities. In the income shares model, the support obligations remain proportionate. So these parents would have support obligations consistent with their relative earnings.
Computation of Actual Income (AAI)
Because child support obligations depend on a parent’s income, a big question comes up: how is a parent’s income computed for child support purposes? The Maryland Child Support Guidelines Worksheet and Form DR 30 (which is the financial statement) provide detailed information on how income is calculated. Importantly, the rules for determining your income differ in some ways when compared with the computation of income for federal income tax purposes.Your adjusted actual income (AAI) typically includes all earned and unearned pretax income, such as standard wages, commissions, self-employment income, gambling income, military salary, dividends, and so forth. Self-employed workers are able to deduct some of the costs of doing business from their AAI. You must consult the guidelines to see exactly how your AAI will be computed. You should know that the Maryland guidelines are generally less favorable than the computations for your federal tax burden.
Additional Points on Child Support Determinations
You should know a few extra things regarding child support determinations here in Maryland. One thing is that judges can adjust the obligations of the parents after they make it. For instance, after making the calculations, parents can adjust for certain items, such as healthcare insurance, childcare expenses, and a few other things. In addition, after a judge has reviewed support obligations, the judge can also independently decide to add additional obligations for certain things, such as special education expenses.Parents who voluntarily choose to take lower-paying jobs may find themselves stuck with a larger obligation than expected. Maryland courts can impose larger payment obligations if they feel parents are taking lower-paying positions to minimize their obligation. This is also true for parents who choose to remain unemployed altogether.
Contact the Murphy Law Firm for More Information
This overview demonstrates how the State of Maryland calculates child support obligations. In the future, we may return and discuss some of the finer points in more detail. For now, if you’d like to learn more, contact The Murphy Law Firm today by calling 240-493-9116.
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