Pennsylvania: High Income Child Support calculations after Hanrahan v. Bakker
Support in Pennsylvania is standardized by state law into a calculation based on a specific set of factors, including the net income of both parents, the percentage of custody each has the child(ren), and costs of childcare and health insurance to arrive at the reasonable financial needs of children. This last factor was greatly affected for high income parents in June 2018 when the Pennsylvania Supreme Court ruled in Hanrahan v. Bakker.
In that case, the father (Hanrahan) argued that simply plugging net income into state formulas did not yield a reasonable amount of child support. Although state law Pa.R.C.P. 1910.16-3.1 (adopted in 2010) allows for a variable calculation if the parents’ combined income is more than $30,000.00 per month, Hanrahan argued that still wasn’t fair. Since his income had jumped from $2.3 million to $15.5 million in one year, his monthly support payments likewise increased from $7,851.00 to $60,000.00 per month. The mother’s income was $105,000.00 per year.
The Supreme Court agreed, concluding that “a court should engage in additional scrutiny of the reasonable needs of the particular children involved in the high income case before it.” The sweeping judgment now allows for discrete consideration of the individual children’s needs, not just blind adherence to a percentage formula.
In other words, such discretionary adjustment downward of the formula support amount is now in the hands of the court, based on evidentiary consideration of the children’s needs. This opens the door for attorneys or parties to argue that certain lifestyle expectations ought to be considered, things like expensive vacations, trips in private jets, prime tickets to sporting and concert events, and other luxuries typically enjoyed by children of wealthier parents. Obviously, if a child has a special need or special ability or talent requiring extraordinary outlays of money, this can now be factored in as well.
Now more than ever, high income parents need to consult with an attorney when considering how to approach child support matters. Contact my office at 215-345-5259 to schedule a free first consult about child support. I’m here to help!
– Elissa C. Goldberg, Esquire
Law Office of Elissa C. Goldberg
107 North Broad Street, Suite 211
Doylestown, PA 18901