As part of the divorce process, oftentimes alimony and/or child support are ordered by the court. A court in the state of Florida will only make these determinations after a careful examination of the financial records of both parties. Determining what is considered income for purposes of calculating alimony and child support payments is an important part of this process.
Calculation of Income in Florida for purposes of calculating alimony and child support.
Determination of the parties’ income is crucial both for calculating alimony and child support. For alimony purposes is crucial as alimony is calculated based on one party’s need and the other party’s ability to pay. Child support is calculated based on the parties’ income and the amount of overnights each parent spends with the children.
In most cases, both parties will submit information to the courts that details their wages and income. This can be done through W-2 earnings statements, pay stubs from an employer, or other evidence of financial earnings.
However, in some cases, one party may quit their job in order to avoid paying alimony or child support. Or, a party may decide to only accept part-time work instead of full-time work in order to avoid making these mandatory required payments.
In these cases, the court will “impute” income to a party in the divorce. Essentially, the court will assume that a party has a certain amount of income, even if they do not, in fact, have that income. The court will look at the educational background, physical condition, emotional condition and employment history of a party in the divorce and determine, under typical circumstances, what their income should be, instead of what it actually is. These cases occur when a party is clearly attempting to avoid paying alimony and child support. A court will impute income when they feel that the financial picture provided by a party is not accurate. A court can impute income on behalf of a request of the other party, or on its own.
The definition of income in the world of Florida family law is different than what you may think. It includes the following:
- Your salary or wages;
- Bonuses, commissions, tips, etc.;
- Your business income if you are self-employed or have a side business;
- Disability benefits;
- Your pension, retirement or annuity payments;
- Alimony actually received;
- Interests and dividends;
- Rental income;
- in-kind payments to the extent that they reduce personal living expenses
- and more.
One party’s income may become a contentious aspect of the divorce. If one spouse is self-employed, he or she likely pays for some personal expenses from his or her business. For example, if a spouse pays for his or her cell phone, car payment, car insurance, health insurance, life insurance and other expenses from his or her business, those expenses are added to his or her “income”. These are in-kind payment that reduce a party’s personal living expenses.
If one spouse is claiming alimony, it will be crucial to determine how much the other spouse really earns. This will mean that business records will have to be reviewed and analyzed to determine what personal expenses are being paid from the business.
In some cases, one party may be receiving support from his or her parents or other family members every month. If these payments are regular, recurring and continue for a certain period of time, the other side may ask the court to impute that income to the recipient.
But calculating income is not only about money that you receive. The law allows you to deduct certain categories of expenses to determine your net income.
For example, how much you pay in income tax, social security and Medicare, mandatory union dues, monthly health insurance payment for you, child support you were ordered to pay on another case and also alimony. No other deductions are allowed in order to determine your net income.
Determination of income may become the center of your case. The more prepared you are and more organized you are, the less time you will spend on this issue.
Contact an Experienced Divorce Attorney
Consulting with an experienced divorce attorney will help you understand your rights and obligations with respect to either alimony or child support, and how your income will be calculated. Call The Law Office of Dana Pechersky at 954.529.2057 today for a free consultation regarding your case.