Determining “income” for child support purposes – not as easy as it sounds

One of the key steps when an Idaho court determines child support is to determine the “income” of each parent. Defining “income” is not always so straight-forward.

A parent’s “income” under the Idaho Child Support Guidelines is defined as the parent’s gross income, with certain adjustments. Gross income is broadly defined to include income from any source. This includes wages, tips, bonuses, trust income, and social security benefits. It also includes education grants, scholarships, and financial aid, for any parent who is also a student. It includes public assistance programs, unemployment, and disability pay.

Some income that is a one-shot deal, such as a gift, prize (like lottery winnings), or severance pay, might be considered income — it is up to the judge to determine in each case. Also included in this category are proceeds from the liquidation of an asset.

Overtime (time worked in excess of forty hours per week) is typically not included where a parent has taken on additional, voluntary employment, either through the same employer or for two different employers. If overtime is required for a particular job, however, than payments for that overtime may also be included as income.

Rental and other business income is also included, but only to the extent that income exceeds the cost to obtain the income. So if a parent receives monthly rent of $1,000, but pays a mortgage and other expenses on that rental of $750 per month, the parent receives “income” of $250 for child support purposes. A self-employed parent’s business income for federal tax purposes and for child support purposes may be different.

One sometimes confusing issue in child support is that the income of a parent’s spouse is not considered as income for child support, even though the parent has a community property interest in one-half of the spouse’s income. (Similarly, even though the parent’s spouse has a community property interest in one-half of the parent’s income, that fact is ignored for purposes of child support.) Similarly, if a parent receives contributions toward living expenses from someone else, such as a grandparent, those contributions are typically not considered income.

Fringe benefits are included if they are significant and reduce the parent’s living expenses. Thus, free housing, room and board, a per diem, or a company car can all be considered income.

If a parent is not working to his or her full ability, that parent is said to be unemployed or underemployed, and the parent’s income for support might not be his or her actual income. If such a parent is mentally or physically incapacitated and unable to work, then that parent’s actual income will be his or her income for child support purposes. So too, if the parent has been employed full-time in his or her current occupation for the prior six months, that parent’s actual income is used, even if the parent could make more money pursuing a different occupation. (So a person who is licensed as a doctor but has been working for years as a burger-flipper gets to use his burger-flipping income.) If the parent is not working because he or she is staying home with a child under six months of age, that parent also gets to use his or her actual income for child support purposes.

If a person is unemployed or underemployed and does not fall into any of the categories discussed above, the court must determine that parent’s potential income, considering her work history and qualifications and the job market. That potential income is then imputed to the parent and will be used in the calculation of her income for child support purposes.

Finally, if a person has an asset that is not currently producing income, but could produce income, the court may attribute income to the parent for that asset. So a parent cannot decrease his or her child support by taking a rental property off the market.

Although determining “income” for a parent sounds like an easy task, it often results in disputes as to exactly what to count. If you have a question about calculating child support for your family, please contact Learned Lawyer today.

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