Today, the Federal government requires every state in the US to have a formulaic, and repeatable way to calculate child support.
But before each state enacted its own guideline, child support was decided by a family law judge who would simply pull a number out of thin air.
Doesn’t seem fair, or formulaic, does it?
And while the Federal government’s idea of a repeatable formula to calculate child support was a good idea, the trouble was they allowed each state to come up with their own model.
So now every state determines child support in a different way!
Some states use a formula known as the “Percentage of Obligor’s Income” Model. You’d simply take a percentage of the supporting party’s income (based on the number of children you have) give it to the other party, and you’re done.
But not in Michigan.
The Michigan child support formula is quite complex.
Michigan uses an approach known as the “Income Shares” Model.
In very basic terms, an income shares model considers the incomes of you and your spouse, and the number of overnights the children will spend with each of you. And then calculated an amount of money one party will pay to the other party to offset the difference in their incomes and parenting time.
The first thing you notice is you need to have your parenting plan figured out before you can calculate child support.
And since income is also one of the factors, and spousal support can be considered income to the recipient, and a reduction in income for the party paying it, you will need to agree on that as well.
Starting to see why calculating child support in Michigan isn’t as easy as you might have thought?
There are also several other deductions and adjustments that can be made which will impact the child support amount the calculator outputs. And agreeing on those deductions and adjustments is another matter entirely.
For example, your 401(k) contributions. Is it fair for one or both of you to deduct those from your income when calculating child support?
Especially if it means your children aren’t going to get the financial support they need?
And don’t forget, this guideline was developed by the State of Michigan. But the State of Michigan doesn’t know the exact amount required to ensure your kids are properly supported so they’ll thrive.
Only you know what it really costs to raise your kids!
So, while you might think you simply run the guideline and use the number calculated, it’s not even close. The reality is, the number isn’t a hard and fast formula, but rather, a suggestion.
And it’s just a starting point for negotiation.
From there, it’s up to you and your spouse to negotiate an agreement that’s in the best interests of your children and that you both find fair.
Which is not so easy to do.
4.) What does child support cover in Michigan?
So now that you've learned how does child support work in Michigan, let’s look at what does child support cover in Michigan.
As you may be surprised at how little that is.
As you’ve learned, the state of Michigan child support formula outputs a dollar amount that one parent should pay to the other. So that each has enough money to cover their children’s expenses.
But even when you run the calculator, there are still many other expenses that aren’t included.
Leaving you to wonder what does child support cover in Michigan?
At its core, the Michigan child support calculators attempt to output an amount of financial support that covers your kid's “ordinary” expenses.
An easy way to think of it is “what are the basic things I have to provide my children in order for them to be happy and safe?”
On that list, you might put items such as housing, food, health insurance, and clothing.
But as a parent, you know there’s so much more involved than just feeding your kids and putting a roof over their heads!
Tablets and smartphones;
Prom dresses and tuxes;
And the list goes on and on...
All of these are known as "extraordinary" expenses and are not included in the basic child support amount.
These items must be discussed and negotiated separately to ensure your children get the financial support they need and deserve.
And there are other expenses that aren’t exactly clear. For example, daycare.
Is that in or out of the calculation? The answer?
So, answering the question of what does child support cover in Michigan is again, a matter of negotiation.
5.) What other issues need to be negotiated when discussing child support in Michigan?
In addition to the ordinary and extraordinary costs associated with having a child, you and your spouse will also need to discuss and come to an agreement on:
Who claims the children on their taxes;
Who will pay for their health insurance;
Whether you have enough life insurance to cover the children’s expenses including when they go off to college;
How long child support payments will last (because for some children, it may extend beyond age 18)
How to handle any changes in the cost of living from year to year. In 2021, inflation rose 6.8% making the cost of raising children markedly more expensive, and it shows no signs of slowing down.
Making the list of what is not resolved by running the guidelines longer and longer.
6.) Why can't we just use Michigan Child Support Guidelines "as-is?"
For the Michigan child support formula to work as-is, your income, and your spouse’s income, must be the same from month to month and year to year.
But for many of our clients, that’s simply not the case.
Often, our clients’ compensation packages contain bonuses, commissions, stock options, and profit-sharing in the company they work for. If this sounds like you, the guidelines simply won’t work as-is.
And how much child support is too much?
I know this may be strange to say, but what if you and your spouse are high-income earners. And you think the amount of child support is too high?
After all, there’s only so much food a kid can eat or electricity they can use, so why should the child support amount keep going up and up the more you each make?
If that’s the case, you’ll have no choice but to skip the outputted amount and negotiate a more appropriate amount instead.
Which is not always so easy to do.
And the answer to "how long is child support paid for in Michigan" isn't as simple as you think.
As you learned above, child support can come in many different forms. The two primary ones being ordinary and extraordinary expenses.
Sometimes child support can stop when a child graduates high school or turns 18. And sometimes, it does not.
The truth is there can be exceptions agreed upon by you and your spouse. As parents, the two of you have quite a bit of latitude to decide what works for your children, in your unique situation.
So, while child support can end when they graduate high school, or turn 18, often, it does not.
7.) All of this sounds complicated. Can't I just go to court and let a judge decide?
There’s something you need to understand here: when the law gets involved, it's a problem
In a litigated divorce, a judge determines child support.
Sounds scary, doesn’t it?
Because that judge will dictate the terms of the settlement in court and both spouses might wind up with something they don’t think is fair or that doesn’t appropriately meet the needs of their children.
That’s why it’s better to negotiate this issue out of court and that’s exactly what mediation is all about.
In mediation, you get to decide - and come to an agreement that's in the best interest of your children and you both agree is fair, instead of letting your future be decided by a stranger.
8.) How will I get the best child support result?
Child support issues will vary based on your situation and circumstances.
And as you’ve learned, there is more than meets the eye on this topic. So don't risk putting your children's financial future in jeopardy by trying to resolve child support on your own.
Using our extensive financial knowledge into the complex matters of Michigan child support, we’ll help you and your spouse determine a child support amount that accurately reflects your lives as parents and the specialized needs of your children.
One that covers all ordinary, extraordinary and future expenses.
We’ll talk about who your children are, what they like to do and what it will take to make sure they’re getting what they need and deserve. Not just what the formula says you have to pay so they can “get by.”
We’ll work through specialized cases like joint custody child support in which you share in the parenting time and care of your children equally as the Michigan Child Support Calculator doesn't always accurately account for this.
We’ll help you negotiate any issues of disagreement and create an agreement you both find fair and equitable regarding the support of your children.
We’ll also make sure you and your spouse not only come to an agreement that you both find to be fair, but also one that minimizes tax issues, avoids penalties and improves cash flow whenever possible.
Because no two situations are alike.
Your children are unique and your child support agreement should reflect that, too.
Equitable Mediation can help you prevent your children from becoming economic victims of your divorce.
Why be forced to accept a settlement created by a family law attorney or judge in court when you can have a direct say in creating an agreement that works for your children now and into the future instead?
If you want your divorce to be fair and equitable, and you want to make decisions as parents, not as litigants, do what’s best for your kids and mediate your divorce with Equitable Mediation.
If you and your spouse have both agreed to divorce and want to mediate, take the next step and book an initial meeting for the two of you.
Joe Dillon, MBA is a professional divorce mediator and founder of Equitable Mediation Services. Joe is passionate about helping couples avoid the destruction of attorney-driven litigation and specializes in helping couples resolve the issues required for divorce -peacefully, fairly and cost-effectively. When he’s not mediating, you can find him exercising, cooking, and watching Cubs baseball.