Section 1910.16-2. Support Guidelines. Calculation of Net Income

Generally, the amount of support to be awarded is based upon the parties’ monthly net income.

(a) Monthly Gross Income. Monthly gross income is ordinarily based upon at least a six-month average of all of a party’s income. The term ‘‘income’’ is defined by the support law, 23 Pa.C.S.A. § 4302, and includes income from any source. The statute lists many types of income including, but not limited to:

(1) wages, salaries, bonuses, fees and commissions;

(2) net income from business or dealings in property;

(3) interest, rents, royalties, and dividends;

(4) pensions and all forms of retirement;

(5) income from an interest in an estate or trust;

(6) Social Security disability benefits, Social Security retirement benefits, temporary and permanent disability benefits, workers’ compensation and unemployment compensation;

(7) alimony if, in the discretion of the trier of fact, inclusion of part or all of it is appropriate; and

Official Note

Since the reasons for ordering payment of alimony vary, the appropriateness of including it in the recipient’s gross income must also vary. For example, if the obligor is paying $1,000 per month in alimony for the express purpose of financing obligee’s college education, it would be inappropriate to consider that alimony as income from which the obligee could provide child support. However, if alimony is intended to finance the obligee’s general living expenses, inclusion of the alimony as income is appropriate.

(8) other entitlements to money or lump sum awards, without regard to source, including lottery winnings, income tax refunds, insurance compensation or settlements; awards and verdicts; and any form of payment due to and collectible by an individual regardless of source.

Official Note

The trial court has discretion to determine the most appropriate method for imputing lump-sum awards as income for purposes of establishing or modifying the party’s support obligation. These awards may be annualized or they may be averaged over a shorter or longer period of time depending on the circumstances of the case. They may also be escrowed in an amount sufficient to secure the support obligation during that period of time.

Income tax refunds should not be included as income to the extent they were already factored into the party’s actual tax obligation for purposes of arriving at his or her net income.

(b) Treatment of Public Assistance, SSI Benefits, Social Security Payments to a Child Due to a Parent’s Death, Disability or Retirement and Foster Care Payments.

(1) Public Assistance and SSI Benefits. Neither public assistance nor Supplemental Security Income (SSI) benefits shall be counted as income for purposes of determining support.

(2) Social Security Derivative Benefits for a Child.

(A) This subdivision (A) shall be applied if a child for whom support is sought is receiving Social Security derivative benefits as a result of either parent’s retirement or disability.

(i) If a child for whom support is sought is receiving Social Security benefits as a result of a parent’s retirement or disability, the amount of the benefit shall be added to the income of the party receiving the benefit on behalf of the child to calculate child support. Next, apportion the amount of basic child support set forth in the schedule in Rule 1910.16-3 between the parties based upon each party’s percentage share of their combined net monthly income, including the child’s benefit in the income of the party receiving it.

(ii) If the child’s benefit is being paid to the obligee, the amount of the child’s benefit shall be deducted from the basic support obligation of the party whose retirement or disability created the child’s benefit. If the child’s benefit is being paid to the obligor, the child’s benefit shall not be deducted from the obligor’s obligation, even if the obligor’s retirement or disability created the child’s benefit. In cases of equally shared custody, first determine which party has the higher income without the benefit, and thus is the obligor, before adding the child’s benefit to the income of the party receiving it.

(iii) In cases in which the obligor is receiving the child’s benefits, the domestic relations sections shall provide the parties with two calculations theoretically assigning the benefit to each household.

(iv) In allocating additional expenses pursuant to Rule 1910.16-6, the allocation shall be based upon the parties’ incomes before the addition of the child’s benefit to the income of the party receiving it.

(B) This subdivision (B) shall be applied when determining the support obligation of a surviving parent when the child for whom support is sought is receiving Social Security derivative benefits as a result of the other parent’s death. The income of a non-parent obligee who is caring for a child but has no support obligation to that child shall include only those funds the obligee is receiving on behalf of the child, including the Social Security derivative benefits if they are being paid to the obligee. If the benefits are being paid to the surviving parent, the amount of the benefit shall be added to that parent’s income to calculate child support.

(3) Foster Care Payments. If either party to a support action is a foster parent and/or is receiving payments from a public or private agency for the care of a child who is not his or her biological or adoptive child, those payments shall not be included in the income of the foster parent or other caretaker for purposes of calculating child support for the foster parent’s or other caretaker’s biological or adoptive child.

Example 1. The obligor has net monthly income of $2,000. The obligee’s net monthly income is $1,500 and the obligee, as primary custodial parent of the parties’ two children, receives $700 per month in Social Security derivative benefits on behalf of the children as a result of the obligor’s disability. Add the children’s benefit to the obligee’s income, which now is $2,200 per month. At the parties’ combined net monthly income of $4,200, the amount of basic child support for two children is $1,272. As the obligor’s income is 48% of the parties’ combined monthly net income, the obligor’s preliminary share of the basic support obligation is $611. However, because the obligor’s disability created the children’s Social Security derivative benefits that the obligee is receiving, the obligor’s obligation is reduced by the amount of the benefit, $700. As the amount cannot be less than zero, the obligor’s obligation is $0 per month. If it were the obligee’s disability that created the benefit, the obligor’s obligation would remain $611. If the obligor were receiving the children’s benefit as a result of the obligor’s retirement or disability, the obligor’s income would include the amount of the benefit and total $2,700, or 64% of the parties’ combined net monthly income. The obligor’s share of the basic support obligation would then be $814 and would not be reduced by the amount of the children’s benefit because the obligor, not the obligee, is receiving the benefit. Therefore, the obligor’s obligation is less if the obligee is receiving the benefit created by the obligor.

Example 2. Two children live with Grandmother who receives $800 per month in Social Security death benefits for the children as a result of their father’s death. Grandmother also receives $500 per month from a trust established by Father for the benefit of the children. Grandmother is employed and earns $2,000 net per month. Grandmother seeks support from the children’s mother, who earns $1,500 net per month. For purposes of calculating Mother’s support obligation, Grandmother’s income will be $1300, the amount she receives on behalf of the children in Social Security derivative benefits and income from the trust. (If Mother were receiving the benefit on behalf of the children it would be added to her income such that Mother’s income would be $2,300 and Grandmother’s would be $500.) Therefore, the obligee’s and Grandmother’s combined net monthly incomes total $2,800. The basic support amount at the $2,800 income level for two children is $948. Subtracting from that amount the $800 in Social Security derivative benefits Grandmother receives for the children, results in a basic support amount of $148. As Mother’s income of $1,500 is 54% of the parties’ combined income of $2,800, her support obligation to Grandmother is $80 per month. If Grandmother were not receiving the children’s derivative benefits or income from the trust, her income for purposes of calculating Mother’s child support obligation would be zero and Mother would pay 100% of the basic support amount because Grandmother has no support obligation to the children.

Official Note

Care must be taken to distinguish Social Security from Supplemental Security Income (SSI) benefits. Social Security benefits are income pursuant to subdivision (a) of this rule.

(c) Monthly Net Income.

(1) Unless otherwise provided in these rules, the court shall deduct only the following items from monthly gross income to arrive at net income:

(A) federal, state, and local income taxes;

(B) unemployment compensation taxes and Local Services Taxes (LST);

(C) F.I.C.A. payments (Social Security, Medicare and Self-Employment taxes) and non-voluntary retirement payments;

(D) mandatory union dues; and

(E) alimony paid to the other party.

(2) In computing a spousal support or alimony pendente lite obligation, the court shall deduct from the obligor’s monthly net income all of his or her child support obligations and any amounts of spousal support, alimony pendente lite or alimony being paid to former spouses.

(d) Reduced or Fluctuating Income.

(1) Voluntary Reduction of Income. When either party voluntarily assumes a lower paying job, quits a job, leaves employment, changes occupations or changes employment status to pursue an education, or is fired for cause, there generally will be no effect on the support obligation.

(2) Involuntary Reduction of, and Fluctuations in, Income. No adjustments in support payments will be made for normal fluctuations in earnings. However, appropriate adjustments will be made for substantial continuing involuntary decreases in income, including but not limited to the result of illness, lay-off, termination, job elimination or some other employment situation over which the party has no control unless the trier of fact finds that such a reduction in income was willfully undertaken in an attempt to avoid or reduce the support obligation.

(3) Seasonal Employees. Support orders for seasonal employees, such as construction workers, shall ordinarily be based upon a yearly average.

(4) Earning Capacity. If the trier of fact determines that a party to a support action has willfully failed to obtain or maintain appropriate employment, the trier of fact may impute to that party an income equal to the party’s earning capacity. Age, education, training, health, work experience, earnings history and child care responsibilities are factors which shall be considered in determining earning capacity. In order for an earning capacity to be assessed, the trier of fact must state the reasons for the assessment in writing or on the record. Generally, the trier of fact should not impute an earning capacity that is greater than the amount the party would earn from one full-time position. Determination of what constitutes a reasonable work regimen depends upon all relevant circumstances including the choice of jobs available within a particular occupation, working hours, working conditions and whether a party has exerted substantial good faith efforts to find employment.

(e) Net Income Affecting Application of the Support Guidelines.

(1) Low Income Cases.

(A) When the obligor’s monthly net income and corresponding number of children fall into the shaded area of the schedule set forth in Rule 1910.16-3, the basic child support obligation shall first be calculated using the obligor’s income only. For example, where the obligor has monthly net income of $1,100, the presumptive amount of support for three children is $156 per month. This amount is determined directly from the schedule in Rule 1910.16-3. Next, calculate the obligor’s child support obligation as in any other case, using both parties’ monthly net incomes. The lower of the two calculations shall be the obligor’s basic child support obligation.

Example: The parties have two children. The obligor has net monthly income of $1,500, which falls into the shaded area of the schedule for two children. Using only the obligor’s income, the amount of support for two children would be $518. Next, calculate support using both parties’ incomes. The obligee has net monthly income of $2,500 so the combined net monthly income of the parties is $4,000. The basic shild support amount at that income level for two children is $1,240. As the obligor’s income is 38% of the combined net monthly income of the parties, the obligor’s share of the basic support amount is $471. As the amount of support the obligor would pay using the obligor’s income alone is more than the amount calculated using both parties’ incomes, the lower amount would be awarded. Thus, the obligor’s basic child support obligation is $471.

(B) In computing a basic spousal support or alimony pendente lite obligation, the presumptive amount of support shall not reduce the obligor’s net income below the Self-Support Reserve of $931 per month. For example, if the obligor earns $1,000 per month and the obligee earns $300 per month, the formula in Part IV of Rule 1910.16-4 would result in a support obligation of $280 per month. Since this amount leaves the obligor with only $720 per month, it must be adjusted so that the obligor retains at least $931 per month. The presumptive minimum amount of spousal support, therefore, is $69 per month in this case.

(C) When the obligor’s monthly net income is $931 or less, the court may award support only after consideration of the parties’ actual financial resources and living expenses.

(2) High Income Cases. When the parties’ combined net income exceeds $30,000 per month, calculation of child support, spousal support and alimony pendente lite shall be pursuant to Rule 1910.16-3.1.

(f) Dependency Tax Exemption. In order to maximize the total income available to the parties and children, the court may, as justice and fairness require, award the federal child dependency tax exemption to the non-custodial parent, or to either parent in cases of equally shared custody, and order the other party to execute the waiver required by the Internal Revenue Code, 26 U.S.C.A. § 152(e). The tax consequences resulting from an award of the child dependency exemption must be considered in calculating each party’s income available for support.

Explanatory Comment—2010

Subdivision (a) addresses gross income for purposes of calculating the support obligation by reference to the statutory definition at 23 Pa.C.S.A. § 4322. Subdivision (b) provides for the treatment of public assistance, SSI benefits, Social Security derivative benefits and foster care payments.

Subdivision (c) sets forth the exclusive list of the deductions that may be taken from gross income in arriving at a party’s net income. When the cost of health insurance premiums is treated as an additional expense subject to allocation between the parties under Rule 1910.16-6, it is not deductible from gross income. However, part or all of the cost of health insurance premiums may be deducted from the obligor’s gross income pursuant to Rule 1910.16-6(b) in cases in which the obligor is paying the premiums and the obligee has no income or minimal income. Subdivision (c) relates to awards of spousal support or alimony pendente lite when there are multiple families. In these cases, a party’s net income must be reduced to account for his or her child support obligations, as well as any pre-existing spousal support, alimony pendente lite or alimony obligations being paid to former spouses who are not the subject of the support action.

Subdivision (d) has been amended to clarify the distinction between voluntary and involuntary changes in income and the imputing of earning capacity. Statutory provisions at 23 Pa.C.S.A. § 4322, as well as case law, are clear that a support obligation is based upon the ability of a party to pay, and that the concept of an earning capacity is intended to reflect a realistic, rather than a theoretical, ability to pay support. Amendments to subdivision (d) are intended to clarify when imposition of an earning capacity is appropriate.

Subdivision (e) has been amended to reflect the updated schedule in Rule 1910.16-3 and the increase in the Self-Support Reserve (‘‘SSR’’). The schedule now applies to all cases in which the parties’ combined net monthly income is $30,000 or less. The upper income limit of the prior schedule was only $20,000. The amount of support at each income level of the schedule also has changed, so the examples in Rule 1910.16-2 were revised to be consistent with the new support amounts.

The SSR is intended to assure that obligors with low incomes retain sufficient income to meet their basic needs and to maintain the incentive to continue employment. When the obligor’s net monthly income or earning capacity falls into the shaded area of the schedule, the basic child support obligation can be derived directly from the schedule in Rule 1910.16-3. There is no need to use the formula in Rule 1910.16-4 to calculate the obligor’s support obligation because the SSR keeps the amount of the obligation the same regardless of the obligee’s income. The obligee’s income may be a relevant factor, however, in determining whether to deviate from the basic guideline obligation pursuant to Rule 1910.16-5 and in considering whether to require the obligor to contribute to any additional expenses under Rule 1910.16-6.

Since the schedule in Rule 1910.16-3 sets forth basic child support only, subdivision (e)(1)(B) is necessary to reflect the operation of the SSR in spousal support and alimony pendente lite cases. It adjusts the basic guideline obligation, which would otherwise be calculated under the formula in Rule 1910.16-4, so that the obligor’s income does not fall below the SSR amount in these cases.

Previously, the SSR required that the obligor retain at least $748 per month. The SSR now requires that the obligor retain income of at least $867 per month, an amount equal to the 2008 federal poverty level for one person. When the obligor’s monthly net income is less than $867, subsection (e)(1)(C) provides that the court must consider the parties’ actual living expenses before awarding support. The guidelines assume that at this income level the obligor is barely able to meet basic personal needs. In these cases, therefore, entry of a minimal order may be appropriate. In some cases, it may not be appropriate to order support at all.

The schedule at Rule 1910.16-3 sets forth the presumptive amount of basic child support to be awarded. If the circumstances warrant, the court may deviate from that amount under Rule 1910.16-5 and may also consider a party’s contribution to additional expenses, which are typically added to the basic amount of support under Rule 1910.16-6. If, for example, the obligor earns only $900 per month but is living with his or her parents, or has remarried and is living with a fully-employed spouse, the court may consider an upward deviation under Rule 1910.16-5(b)(3) and/or may order the party to contribute to the additional expenses under Rule 1910.16-6. Consistent with the goals of the SSR, however, the court should ensure that the overall support obligation leaves the obligor with sufficient income to meet basic personal needs and to maintain the incentive to continue working so that support can be paid.

Subdivision (e) also has been amended to eliminate the application of Melzer v. Witsberger, 505 Pa. 462, 480 A.2d 991 (1984), in high income child support cases. In cases in which the parties’ combined net monthly income exceeds $30,000, child support will be calculated in accordance with the three-step process in new rule 1910.16-3.1(a).

Explanatory Comment—2013

The SSR has been increased to $931, the 2012 federal poverty level for one person. Subdivision (e) has been amended to require that when the obligor’s income falls into the shaded area of the basic child support schedule in Rule 1910.16-3, two calculations must be performed. One calculation uses only the obligor’s income and the other is a regular calculation using both parties’ incomes, awarding the lower amount to the obligee. The two step process is intended to address those cases in which the obligor has minimal income and the obligee’s income is substantially greater.

Explanatory Comment—2015

The rule has been amended to provide that a party’s support obligation will be reduced by the amount of a child’s Social Security derivative benefit if that party’s retirement or disability created the benefit and the benefit is being paid to the household in which the child primarily resides or the obligee in cases of equally shared custody. In most cases, payment of the benefit to the obligee’s household will increase the resources available to the child and the parties. The rule is intended to encourage parties to direct that the child’s benefits be paid to the obligee.

The provisions of this Rule 1910.16-2 adopted September 29, 1989, effective September 30, 1989, 19 Pa.B. 4151; rescinded and replaced January 27, 1993, effective immediately, 23 Pa.B. 701; amended December 7, 1998, effective April 1, 1999, 28 Pa.B. 6162; amended October 27, 2000, effective immediately, 30 Pa.B. 5837; amended October 30, 2001, effective immediately, 31 Pa.B. 6273; amended November 9, 2004, effective immediately, 34 Pa.B. 6315; amended September 27, 2005, effective four months from date of this order, 35 Pa.B. 5643; amended January 5, 2010, effective immediately, 40 Pa.B. 413; amended January 12, 2010, effective May 12, 2010, 40 Pa.B. 586; amended August 26, 2011, effective September 30, 2011, 41 Pa.B. 4849; amended November 5, 2012, effective December 5, 2012, 42 Pa.B. 7091; amended April 9, 2013, effective August 9, 2013, 43 Pa.B. 2272; amended April 29, 2015, effective July 1, 2015, 45 Pa.B. 2352. Immediately preceding text appears at serial pages (366485) to (366491).