California’s legislature has told us that “the mother and father of a minor child have an equal responsibility to support their child in a manner suitable to the child’s circumstances.” (Cal. Fam. Code section 3900). They have developed the child support guideline, a strictly applied formula which looks at parental timeshare and financial circumstances, to direct the courts about how to impose that responsibility. As parents navigate the family court system, they will generally find themselves with a support order to ensure both parents are contributing to the support.
When a parent’s income substantially changes, whether it be from a promotion, job loss, or substantial salary increase or reduction, it is important to consider whether a modification of child support is appropriate.
Severance pay is considered “income” for the time period in which it is paid. If an employee receives a considerable severance package, it may be appropriate to delay the filing of a modification request. There are countless other “income” forms, including unemployment insurance compensation, bonuses, commissions and earned interest.
The income changes should be input into the statewide support guideline to determine how they will affect the support payment. There are a variety of calculation programs used by family law attorneys. California’s Child Support Services Department also has a web-based calculator available free of charge.
It is important to know that a court cannot retroactively modify a support order – if a parent loses his or her job in May, but delays asking for a modification until July, the modification will not take effect until July. Despite the job loss, that parent will be obligated to pay the old support rate in May and June. So if a modification is appropriate, the appropriate application should be filed as soon as possible. While it may take some time to resolve, either by stipulation or in court, the retroactivity date has been preserved and the support calculations can begin.