The income of both parties is one of the most important factors that is included in the calculation of child support. The state of New Jersey has uniform guidelines, however the guidelines do not apply to high income cases. High income cases are defined as cases in which the parents’ combined net annual income is in excess of $187,200 per year. Net income is defined as gross income minus income taxes, mandatory union dues, mandatory retirement continuations, previously ordered child support orders, and when appropriate a child support obligation for other dependents (a child or children from other relationships).
Income for child support purposes is defined as all earned and unearned income that is recurring or that will increase the income available to the recipient over an extended period of time. To determine whether an income source will be included in the child support calculation, the Court will assess whether the income would have been available to pay expenses related to the child if the family was still intact. If the income would have been available to pay those expenses, it is likely that it will be included in the child support calculation. Income for child support calculations is not just limited to wages; among other things, it will include gains from the sale of property, dividends paid, rent collected, bonuses, alimony, social security, retirement account income, unemployment and disability income.
In those cases in which the parents’ combined net income from all sources is more than $187,200 net per year, the first step in calculating the amount of child support is to apply the guidelines up to the highest level available, i.e. $187,200 in combined net income. This child support figure is called the “basic child support figure.” Then, an additional amount is added to the “basic child support figure” to account for the remaining family income. In other words, the “basic child support figure” is the minimum child support award for these families.
The additional amount added to the “basic child support figure” is discretionary and based on statutory factors which include:
(1) Needs of the child;
(2) Standard of living and economic circumstances of each parent;
(3) All sources of income and assets of each parent;
(4) Earning ability of each parent, including educational background, training, employment skills, work experience, custodial responsibility for children including the cost of providing child care and the length of time and cost of each parent to obtain training or experience for appropriate employment;
(5) Need and capacity of the child for education, including higher education;
(6) Age and health of the child and each parent;
(7) Income, assets and earning ability of the child;
(8) Responsibility of the parents for the court-ordered support of others;
(9) Reasonable debts and liabilities of each child and parent; and
(10) Any other factors the court may deem relevant.
The court has a great deal of discretion as to the amount that is ultimately added to the “basic child support figure.” However, the basic premise remains the same: that every child has the right to be financially supported by both parents and if one or both parents are successful, the children have a right to share in that good fortune.