By Ron J. Anfuso, CPA, ABV, CFF, CDFA, FABFA
Senate Bill 343 (SB 343) went into effect on September 1, 2024. This is the first revision to the child support guidelines since 1992. The objectives set forth by the Department of Health and Human Services (DHHS) are to establish accurate child support obligations based on noncustodial parents’ ability to pay; increase consistent, on-time payments to families; move nonpaying cases to paying status; grow the number of noncustodial parents supporting their children; and improve child support collection rates.
Under the new child support guidelines, SB 343 considers a broader range of factors, such as the cost of living, healthcare, education, and other necessary expenses. This safeguards child support amounts to better reflect the needs of raising a child, including providing children an improved standard of living.
Changes Effective September 1, 2024
- CS Guideline formula—increases, decreases, and no change, depending upon income
- Low-income adjustment covers more cases
- Add-ons use the percentage method (same as pre-SB 343 FC 4061(b))
- More listed types of income
- Earning-capacity changes
- 90 days to provide an itemized statement of costs
- Childcare
- Multiple CS orders
No More DissoMaster™
DissoMaster announced it has not renewed its certification and will no longer operate in California. Also, DissoMaster stated that as of November 1 of last year, there will no longer be further updates. Thus, as of January 1 of this year, DissoMaster’s child support calculations are incorrect. Therefore, you must change the default guideline CA Family Code §4055 effective as of September 1, 2024, from “No” to “Yes” for child support calculations on or after September 1, 2024, that are continuing to use DissoMaster.
Most family law judges and attorneys are switching to Xspouse.™ Moving to Xspouse is easy, as its forms and data entry align with DissoMaster.
Changes in Support Calculation
SB 343 replaces the formula for calculating child support with an updated K-factor. The formula now adjusts the percentage of net income of lower-income parents while recalibrating contributions for high-income earners. The purpose is to ensure a fairer system that considers each parent’s financial situation. The result generally has a greater effect on lower-income noncustodial parents than high-income earners.
Spousal support is not explicitly changed in SB 343, but the K percentage of each parent’s earnings reduces income available for spousal support. Since child support is calculated first, this can result in lower spousal support.
Shared Parenting
SB 343 has increased the importance of considering how much time each parent spends with their children. Guidelines now include greater details on how to adjust child support payments based on the percentage of time each parent assumes responsibility for the children. This revision considers the growth of joint custody arrangements and better ensures that parents contribute fairly to their children’s upbringing.
Add-on Expenses
The child support calculation has added additional add-on expenses. Add-ons now include child care, medical costs, extracurricular activities, special needs, and travel expenses. The add-ons can be shared either 50-50 or in proportion to the income of the parents.
Income Bracket Impact
The revisions are designed to ensure equitable child support obligations to benefit the well-being of the children. SB 343 provides mechanisms to keep
low-income earners from dropping below the poverty level due to child support obligations. Those in middle-income brackets will experience a recalibration of child support calculations to better adjust to the financial capabilities and actual costs of raising a child. High-income earners will have their child support payments capped to prevent payments from exceeding the needs of their children.
SB 343 codified the existing practice of low-income obligors being entitled to the low-income adjustment. Furthermore, the threshold for low-income adjustment changed to the amount a parent would earn working a 40-hour week at the current minimum wage. However, this may be rebutted if the court determines in an isolated case that it is unjust. As a result, fewer obligors will have a low-income adjustment. In cases where the child’s support is greater than 50 percent, SB 343 permits a deviation.
Earning Capacity
FC4058(b)(1)(A): In a case when a parent’s annual gross income is unknown, the court SHALL consider the earning capacity of the parent.
FC4058(b)(1)(B): In a case when a parent’s annual gross income is known, the court MAY, at its discretion, consider the earning capacity of the parent in lieu of the parent’s income being consistent with the best interests of the children, taking into consideration the overall welfare and developmental needs of the children, as well as the time parents spend with them.
Expanded Income Sources
SB 323 has increased the sources of income calculated in a parent’s gross income to include veterans’ benefits, severance pay, benefits not based on need, and military allowances for housing and food.
Strengthened Enforcement
SB 343 imposes stricter enforcement, including increased penalties for non-payment and enhanced tools for tracking down delinquent parents.
Suspension of Child Support for Incarcerated Parents
Child support payments are suspended until the tenth full month following release. After this period, child support payments resume to ensure children receive ongoing financial support.
Childcare Cost Changes
The court shall order additional childcare support if expenses related to employment or training for employment are incurred, as described in Section 4063, unless the costs are specifically included in the guideline calculation itself.
SB 343 child support changes are less when the Total Net Disposable Income (TNDI) is less than $5,000 per month and more when it is greater than $6,666 per month. There is no change for TNDI between $5,000 a month and $6,666 per month.
Multiple Support Order Changes
If the court is made aware that a parent is subject to multiple court orders to pay child support arising from a different case or cases, the court may take steps to determine how to allocate the parent’s income and support obligation appropriately across these cases.
In a related case, a court that continues a hearing may issue a temporary court order based on a party’s representation that it will file an appropriate request to modify support.
Periodic Reviews
SB 343 now mandates periodic reviews of child support orders. The purpose is to determine whether there have been changes in income, employment, and the child’s needs over time. This ensures ongoing fairness and whether adjustments to support obligations are necessary.
