2018 Tax Impacts on Child Support & Software Updates

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Some of our subscribers have asked when we will be able to issue updated software reflecting the latest federal tax revisions caused by the Tax Cuts and Jobs Act (TCJA). We are working hard on these updates as we speak, but unfortunately it’s going to take a bit longer. To help explain why, we wanted to take a moment to walk you through some of the anticipated impacts the TCJA will have on child support and what this means for our child support calculators.

How the Federal Income Tax Impacts Child Support

Recently enacted on December 22, 2017, the TCJA impacts the calculation of child support in ways you may not have recognized. For example, in Kansas, the Kansas Child Support Guidelines take into account many aspects of federal income tax, such as:

  • The child tax credit (modified by the TCJA)
  • The value of a child’s personal exemption (abolished by the TCJA)
  • The value of the standard deduction (increased by the TCJA)
  • The parent’s income tax bracket and filing status

Unfortunately, while television and newspapers have highlighted some of the changes brought about by the TCJA, the details (the “fine print”) have not been made as clear.

The TCJA was signed by the president on December 22, 2017, but the IRS and the Department of the Treasury simply haven’t had time to analyze the TCJA and promulgate new rules and forms for its implementation. Authoritative sources are, therefore, difficult to find. For example, the FAQ section of the IRS website dealing with child custody states:

“May a noncustodial parent claim the child tax credit for his or her child? Yes, a noncustodial parent may claim the child tax credit for his or her child if he or she is allowed to claim a dependency exemption for the child and otherwise qualifies to claim the child tax credit.”

However, the personal exemption on which a “dependency exemption” was based has been abolished by the TCJA! This is but one example of revisions that will be needed to determine 2018 taxation.

Furthermore, the child support amounts in the support schedules published in a state’s child support guidelines are typically calculated after taking into account the amount of state and federal income taxes payable on the parents’ gross incomes. {In Kansas, this is Admin. Order 287, Sec. II(c).}

Until the support schedules are recalculated and the guidelines are amended and republished, any calculation of child support using the current guidelines (AO 287 for Kansas) will inevitably be inaccurate.

What This Means for Our Child Support Calculators

The child support calculators we offer through Bradley Software and Child Support Tools represent our best effort at translating a state’s child support guidelines into a computer program to simplify the preparation of the state’s child support worksheet and supporting schedules.

Making the extensive changes called for by the TCJA requires the review and modification of dozens of algorithms and computer code sections. Many of the code sections are interdependent, meaning a change in one may cause others to malfunction. It is necessary, therefore, to conduct testing to avoid such unwanted changes.

We are in the midst of updating the relevant portions of the software, taking guidance from the announcements of the IRS and Department of the Treasury where available. As soon as the updating process is completed, we will conduct the testing required to enable law professionals and parents to rely on our products as they have for more than 25 years.

If you haven’t already,  sign up for our emails or check back on our blogs (Bradley Software for law professionals and Child Support Tools for parents) so you can be the first to know when updated software is available. In the meantime, we appreciate your patience.

Brad Short & Randy Spivey

For law professionals:

For parents:

This entry was posted in Child Support, Child Support Guidelines, Taxes. Bookmark the permalink.

One Response to 2018 Tax Impacts on Child Support & Software Updates

  1. Pingback: New Updates Posted for Kansas Child Support Calculator | Bradley Software

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