Division of Child Support Enforcement

# Withholding Limitations Worksheet

The income withholding documents you receive by mail include the Withholding Limitations Worksheet for Support and Medical Support. You can use the worksheet along with the Income Withholding for Support to calculate the withholding amount. **Note:** You may also need the amount of the ** dependent** health insurance premium, if ordered by a National Medical Support Notice. The on-line income withholding calculator, based on the Withholding Limitations Worksheet, is an additional tool to calculate income withholding.

Calculation of withholding involves four basic steps to determine the following values:

- Disposable income
- Maximum Withholding allowed under the Consumer Credit Protection Act (CCPA)
- Income withholding amounts, including prorated amounts, and
- Dependent health insurance premium
- Amounts to withhold and remit

## Disposable Income

Disposable income equals the earnings left after certain required deductions. New York State law requires the following six deductions:

- Federal income tax
- Social Security tax (FICA)
- Medicare tax
- State income tax
- City/local income tax
- Involuntary retirement or pension plan payments

Subtract the total of these deductions from the employee's gross pay.

Disposable income = Gross pay – Required deductions

## Maximum Withholding: CCPA Limitations on Withholding

The Consumer Credit Protection Act (CCPA) limits withholding for child support. The maximum that can be withheld may be 50, 55, 60 or 65 percent of an employee's disposable income. The CCPA limitation percentage depends on the answers to two questions:

- Does the employee support another spouse or child besides those listed in this NOTICE?

If you don't know whether the employee supports others, ask. - Does the employee owe arrears greater than 12 weeks on
**any**NOTICE?

Check Page 2 of the NOTICE. If the employee owes arrears greater than 12 weeks, the "Yes" box underneath the Itemized List of Payments Due will be checked.

**Note:** If this box is checked on **any** NOTICE for the employee, you must answer ** "Yes"** to this question.

The following table shows the Maximum Withholding limitation percentage for each combination of other dependents and arrears.

CCPA Maximum Withholding Limitation Percentage | ||
---|---|---|

Other dependents | No arrears OR Arrears less than 12 weeks |
Arrears greater than 12 weeks |

Employee supports another spouse or child | 50% | 55% |

Employee does NOT support another spouse or child |
60% | 65% |

For example, if the employee supports others and owes arrears greater than 12 weeks, the correct CCPA limitation percentage is **55%** or **0.55**.

To calculate the Maximum Withholding amount for this employee, multiply the disposable income by 0.55.

Maximum Withholding = Disposable income × CCPA percentage

## Amount to Withhold per Pay Period

Look first at the amount shown as the **TOTAL AMOUNT TO WITHHOLD** on Page 1 of the NOTICE (illustrated below).

Then, if necessary, choose the amount that matches your pay period.

For example, in the illustration, the amount ordered is a *weekly* payment of $202.50. However, if your pay period is **biweekly**, then you should withhold **$405.00** for this NOTICE.

If you have received more than one NOTICE for the employee, withhold the total amount for all NOTICES combined. Remember to withhold the amounts for **your** pay period.

Amount to withhold = Combined Total for all NOTICES per Pay Period

## Prorated Amounts

If an employee's Maximum Withholding is less than the total for all his or her NOTICES, withhold the Maximum Withholding. You must prorate the Maximum Withholding so that each NOTICE receives some payment. You must also identify the prorated amount for each NOTICE when you submit your payment.

For example, suppose an employee has a Maximum Withholding amount of $180.00 weekly. This employee has three NOTICES, for $90, $75, and $62. The total for all three NOTICES is $227.00 weekly—more than the Maximum Withholding. The Maximum Withholding must be prorated for this employee.

In New York State, the pro rata share for each NOTICE is calculated as follows:

- Divide the total withholding for each NOTICE by the total withholding for all NOTICES. For this example, the three pro rata shares are
- 90/227 = 0.3965, or 39.65%
- 75/227 = 0.3304, or 33.04%
- 62/227 = 0.2731, or 27.31%

- Multiply the Maximum Withholding amount by the pro rata percentage for each NOTICE:
- .3965 × 180 = $71.37
- .3304 × 180 = $59.47
- .2731 × 180 = $49.16

The table below shows the proration for this example:

NOTICE 1 | NOTICE 2 | NOTICE 3 | |
---|---|---|---|

Support Due for Each NOTICE | 90.00 | 75.00 | 62.00 |

÷ Total Support Due | 227.00 | 227.00 | 227.00 |

× Maximum Withholding | 180.00 | 180.00 | 180.00 |

= Amount to Withhold | $71.37 | $59.47 | $49.16 |

Total Withholding | $180.00 |

The total of the prorated amounts should equal—but cannot exceed—the Maximum Withholding amount. Check your result by adding the prorated amounts:

71.37 + 59.47 + 49.16 = 180.00

Prorated Withholding = NOTICE X / Total Ordered × Maximum Withholding

## Health Insurance Premium Withholding (Medical Support)

In New York State, the premium for dependent health insurance is withheld only if the employee can pay **both** the total withholding for all NOTICES **and** the full dependent health insurance premium.

The following steps will help you determine whether to withhold a dependent health insurance premium:

- Are you required to withhold a dependent health insurance premium? Have you received a National Medical Support Notice for this employee? If not, you do not need to complete this calculation.
- If yes, subtract the total withholding for all NOTICES from the Maximum withholding:

Maximum withholding – Total withholding for all NOTICES = "Difference" - If the difference is 0 or less, you cannot withhold the health insurance premium. Withhold the total for all NOTICES or the Maximum Withholding.
- If the difference is greater than 0, is the amount of the premium more than the difference?
- If yes, you cannot withhold the health insurance premium. Withhold the total or the Maximum Withholding.
- If no, withhold the premium for your pay period, plus the total to be withheld for all NOTICES.

For an employee with a biweekly total withholding amount of $410.00, a Maximum Withholding of $463.65 and a biweekly dependent health insurance premium of $45.00, the result would be as follows:

- Yes, withholding for health insurance is required for this employee.
- Maximum Withholding ($463.65) – Total Withholding ($410.00) = Difference ($53.65)
- Difference ($53.65) is greater than 0.
- Premium ($45.00) is greater than 0 but less than the difference ($53.65).
- (Premium is less than the difference.)
- The premium can be withheld. The total withholding for this employee is $455.00; the total amount to remit for child support is the total for all Notices, or $410.00.

If Maximum Withholding – Total Withholding > Health Insurance Premium, Withhold Premium

## Amounts to Withhold and Remit

If possible, the final amount to withhold for the employee will include the Total Amount to Withhold for all NOTICES and the full amount of the dependent health insurance premium. However, the amount you **remit to the Processing Center** must include **only the withholding for support**—not the dependent health insurance premium.

For the example described above (total withholding $410.00, premium $45.00), you would withhold the full $455.00 but remit $410.00 to the Processing Center.

Total amount to withhold may include dependent health insurance premium.

Total amount to remit includes child support only.

If you have other questions about income withholding, please contact the Employer Helpline at **1-888-208-4485** (TTY: **1-866-875-9975**).