House Bill 366 modernizes the child support guidelines. The manner in which child support is calculated in Ohio has needed an overhaul for some time. The last update was in 1992 and the result likely produced orders that were too high for low income people. Additionally, the law fails to account for the ever-changing family structures we now see in today’s world.
The dependency exemption has been replaced by the child tax credit. The tax exemption directly reduced a parties’ taxable income. A credit reduces the parties’ tax liability. In other words, a dependent exemption is the income you can exclude from taxable income for each of your dependents (typically your children). Under the old tax code, parties could exclude $4,050 for each dependent. Now that number is $0, but, if eligible, parties may claim a child tax credit.