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Family Law Software can calculate child support guideline amounts in 21 states.

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Question: How can I find the present value (lump sum buyout) for alimony?

Answer:

There are two ways to get the present value calculation:

(1) If you have already entered the parties' income and expenses into the software; or
(2) If you have not.

We will describe each of these approaches.

1. If you have already entered the parties' income and expenses.

The image below, from the Lawyer tab, illustrates the software's calculation of present value, for a case where you have already entered the parties' incomes and expenses.

Just fill in the entries that are highlighted below, and the present value amount will appear instantly.

 

This is an after-tax valuation. The software is using the marginal state and federal tax rates that it calculates, based on all of the other income and expenses that you have input. So if you are using this quick screen, it is important that both parties incomes and expenses have been input.

By default, the software uses a current 20-year treasury bill rate as the "safe rate," the discount rate.

Why do we use this rate?

2. If you have not entered the case information into the software.

For another approach to this same calculation, click Negotiate tab >Alimony PV (Buyout). On that screen, you will be able to override the software's calculation of the marginal federal and state tax rates, and also you can enter alimony amounts right there, so you can jump right in without having used any other part of the software.

The image below shows the entries you would fill in if you wanted to use this page as a stand-alone calculator, without having entered anything else into the software for this case.

 

Also, at the bottom of that screen, you will see a nice little table, that makes the calculation more intuitive by breaking it down into its constituent parts.  (This nice table will only appear, however, if you are using the approach where you enter all the parties' incomes and expenses, and you have entered the "actual" alimony either in the Lawyer tab, as shown above, or the Financial tab, on the Alimony screen.)


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