Not surprisingly, the same questions are asked and asked again as couples embark on the divorce process. Many divorcing individuals believe that support has been set in stone by the Commonwealth’s formulas on child support and alimony. Yes, there are formulas. Yes, the child support formula is revised every four years, with the latest revision effective October 4, 2021. However, it is also true that there are wide variations in support agreements, including variations using the same formula. If we digress from focusing on the support formulas and focus on the question of need, we see openings in the formulas for need-based questions.
The alimony formula is worded:
“Alimony,” the payment of support from a spouse, who has the ability to pay, to a spouse in need of support for a reasonable length of time, under a court order.”
Here is where some variations may occur:
The alimony time period is calculated as a percentage of the length of marriages up to 20 years. The time period does not apply to marriages longer than 20 years but is subject to termination upon the payor’s attainment of full social security retirement age. Yet the court may, in its discretion, modify the duration of alimony.
The amount of alimony is based on a range of percentages calculated on the difference in the parties’ gross incomes. Yet the law also adds “or need,” a term that clearly does not have a precise definition. Thus, the court may, in its discretion, modify the amount of support and, not surprisingly, couples may agree to different percentage calculations as well as to changes in the percentages overtime.
The child support formula also attempts to account for the needs of children and each parent’s ability to provide support. The formula takes into consideration the number and age of children in the family who require support. The formula takes into consideration the cost of childcare services and health insurance, with attention to how much is paid and by whom. The formula takes into consideration with whom the children reside. The formula takes into consideration how much each parent earns in order to balance moneys available to each parent and moneys paid by each parent for childcare services and health insurance. Yet, the October 4th 2021 formula also provides a warning signal. If one parent’s need for support exceeds the other parent’s ability to pay, a deviation from the formula may be necessary. As such the court is recognizing, via its formula, that the payor parent may not have sufficient income to meet the recipient parent’s need for financial assistance. In divorce, as in marriage, need may exceed the family’s financial resources.
Deviations from formulas add to the uncertainty of relying on formulaic approaches as the sole method for determining how much support is to be paid and for how long. To further complicate the picture, the alimony and child support formulas may both be used by the same couple to calculate the total support sum. The combined formula approach requires that the same income is not used twice in the calculation of support. As such if the income of the parent who is paying support is used to first calculate alimony, then child support must be based on the recipient’s income plus alimony and the payor’s income minus alimony. The two-formula approach still raises the questions pertaining to each formula as a separate entity as well as new issues. What happens when alimony or child support ends? How is the individual formula calculated? Is support recalculated for income variations over time? Is the formula adjusted for changes in formulas’ variables (e.g., childcare costs) over time? When does support stop?
Divorcing couples need to focus first and foremost on the basic questions of need and ability to pay. The actual structuring of the amount of support to be paid and the duration of the agreement often requires creative thinking. The solution space may need to be expanded as couples grapple with questions that may pertain to how their needs and the needs of their family may change over time coupled with changing abilities to pay. Employment situations may change. The education of children may need to be funded. Living arrangements may change. Naturally change is predictable even if the nature of the change cannot be forecast. Mediation provides a vehicle and an environment for applying creative problem solving skills to the most difficult of all questions—how much support and for how long. The answer may need to take into consideration how needs and abilities change over time. The answer needs to be shaped to fit each couple’s own situation.