Department of Children and Families
DCF 150
Child Support Percentage of Income Standard
The Wisconsin Department of Children and Families proposes to repeal s. DCF 150.05 (1) (a) (note); to amend ss. DCF 150.02 (10) and (13) 7. and 8., 150.03 (3) and (5), 150.04 (1) (a) and (b) (8), (2) (a) 1. and (b) 5. and 6., and (5) (a) and (e), 150.05 (1) (a), (b) 2. and 3., and (d) 2., and (2) (a); and to create ss. DCF 150.03 (5) (b) and (Note), 150.03 (5m) and (Note), 150.04 (2) (b) 7. and (Note), (5) (e) and (Note) and (f), and (6) (c) and (Note), 150.05 (1) (g) and (Note), and DCF 150 Appendix E, relating to the child support percentage of income standard. Analysis Prepared by the Department of Children and Families
Statutory authority: Section 49.22 (9), Stats. Statutes interpreted: Sections 49.22 (9) (a), 767.225, 767.34. 767.501, 767.511, 767.513, 767.59 (4) and 767.89 (3), Stats Explanation of Agency Authority
The Wisconsin Department of Children and Families is responsible for administering the Child Support Program in Wisconsin under s. 59.53 (5), Stats. Section 49.22 (9), Stats., provides that “the department shall promulgate rules that provide a standard for courts to use in determining a child support obligation based upon a percentage of the gross income and assets of either or both parents. The rules shall provide for consideration of the income of each parent and the amount of physical placement with each parent in determining a child support obligation in cases in which a child has substantial periods of physical placement with each parent.” Summary of the Proposed Rule
Income and Benefits
The proposed rule removes the word “voluntary” from the reference to employee contributions to any pension or retirement account in the definition of gross income in s. DCF 150.02 (13). The proposed rule clarifies that a payer may only receive credit for Social Security Disability or Old Age Insurance derivative benefits for a child in a primary placement case if the benefits are being received by the custodial parent. Additionally, in shared placement cases, the proposed rule provides that the child’s benefit is based on the parent’s percentage of shared care-taking responsibility.
The proposed rule applies the same methodology recommended for Social Security Disability or Old Age Insurance derivative benefits to the calculation of child support in cases where the parents are receiving adoption assistance.
The proposed rule clarifies that veteran’s disability benefits are to be considered income available for child support.
Low-Income Cases
The proposed rule retains the current formula for low-income payers at s. DCF 150.04 (4) but modifies the language for imputing income based on earning capacity in s. DCF 150.03 (3) to provide for the court’s consideration of a range of 10-35 hours per week based on the availability of work in the parent’s community for similarly situated individuals. The proposed rule provides that the low-income formula may be combined with the shared, serial, and split placement formulas.
The proposed rule adds language suggesting job search or a work experience program, such as Children First, as an alternative to imputing income in low-income cases.
The proposed rule clarifies that the amounts in the low income and birth costs charts apply to incomes at or above 75% of the federal poverty level. The proposed rule permits the court to exercise its discretion in setting support for payers with incomes below 75% of the federal poverty guidelines.
Serial-Family Cases
The proposed rule retains the current serial family formula in s. DCF 150.04 (1) with a clarification that serial family parents may be eligible for application of the low-income formula if multiple child support obligations put their income below the low income threshold. The proposed rule clarifies the serial family formula as follows:
• A parent subject to an existing child support order is a serial family payer for the purpose of calculating a support obligation for children from a subsequent family under the provisions of this section and s. DCF 150.04 (2). • A parent with a legal obligation to support a child in an intact family is a serial family payer for the purpose of calculating a support obligation for children from a subsequent family under the provisions of this section and s. DCF 150.04 (2). • A parent subject to a shared placement order is a serial family payer for the purpose of calculating a support obligation for children from a subsequent family under the provisions of this section and s. DCF 150.04 (2). Shared-Placement Cases
The proposed rule requires that variable costs shared by the parties be determined based on a list of variable costs agreed to by the parties or ordered by the court based upon lists furnished by the parties. The proposed rule requires that transportation costs related to the exercise of physical placement be included in that list.
The proposed rule requires that a change in circumstances to modify a child support order should be a change in the circumstances of the parties and not a change in variable costs alone.
The proposed rule retains the current formula for calculating support in shared-placement cases in s. DCF 150.04 (2) using overnights or their equivalent as a measure of shared time but provides more examples of equivalent care that include a pattern of time spent with the children that involves blocks of time that may be less than overnight. Consideration of equivalent care requires that the time spent with the children include a requirement that a meal be provided. The proposed rule repeals the provision allowing variable cost orders to be rolled into the child support amount.
The proposed rule provides that the shared-placement formula may be combined with the low income formula where applicable.
Medical Support
The proposed rule changes the measure of reasonable cost from 5% of each parent’s gross monthly income to 10% of the gross monthly income of each parent and applies it to the full cost of the policy as opposed to the incremental cost of adding the child(ren).
The proposed rule provides that a contribution toward the cost of insurance for the children from the custodial parent should not exceed the incremental cost to add the children to the policy.
The proposed rule adds language requiring the court to consider the effect of the dependency exemption on health insurance responsibility.
The proposed rule clarifies that public programs like Badger Care are acceptable sources of medical support that meet federal requirements for minimal essential coverage when private health insurance is not available at reasonable cost.
The proposed rule provides that recovery of birth costs is inappropriate in cases where the alleged father is a member of an intact family that includes the mother and the subject child, and the father’s income, if any, contributes to the support of the child.
High-Income Cases
The proposed rule retains the existing child support guidelines for payers with annual incomes up to $150,000. The percentage reductions for payers with gross annual incomes between $150,000 and $300,000 will remain at the levels in the current rule, which represents 60% of the amount due under the Percentage of Income Standard. A sliding scale is proposed to further reduce the existing percentages in DCF 150.04(5)(d), beginning at $300,000 annual gross income and reaching an amount that represents 30% of the current standard for gross annual incomes of $500,000 and above.
The proposed rule provides discretion to determine support for incomes above $500,000 annually.
The proposed rule provides that the high-income formula may be combined with the shared, serial, and split placement formulas.
Summary of Factual Data and Analytical Methodologies
The proposed rule revisions were developed in response to recommendations from the Child Support Guidelines Advisory Committee established to provide guidance to the Department on revisions to the state policy regarding the guidelines used to determine child support payments and the application of those guidelines in special circumstances. This report is the result of the extensive deliberations of the advisory committee composed of representatives of the courts, the Wisconsin Bar, community-based organizations and county child support agencies, state legislators, citizens and the Department of Children and Families.
The proposed rule revisions focus on five areas: high income formula, low income formula, shared time formula, serial family formula and medical support guidelines. Additionally, proposed rule revisions make some clarifications to the definition of gross income.
Summary of Related Federal Requirements
Wisconsin’s Percentage of Income Standard was created to comply with federal requirements in 45 CFR 302.56 (a) that require that as a condition of approval of its State plan, all states must establish one set of guidelines by law or by judicial or administrative action for setting and modifying child support award amounts within the State. The methodology to be used in calculating support orders is at state discretion. 45 CFR 302.56 (e) also requires states to review, and revise, if appropriate, the guidelines established under paragraph (a) of this section at least once every four years to ensure that their application results in the determination of appropriate child support award amounts. Comparison to Rules in Adjacent States
Iowa, Minnesota and Michigan use an Income Shares Model to establish child support. Illinois uses a Percentage of Income Standard. The amount of support calculated under Wisconsin’s Percentage of Income Standard is consistent with that of neighboring states.
