Funds For Child Support: What Is Counted?
When parents go through a divorce, one parent or the other is ordered to pay child support. While there might be some unique and rare parenting solutions that don't involve one parent's court-ordered financial contribution, most all divorced parents deal with child support. The amount that is ordered is based on a number of factors and one of the most obvious is the parent's ability to pay. That means that the parent's income is evaluated as a determinate of child support. Read on to find out what income is counted for child support purposes.
Income Sources That Are Counted
The gross income (before any deductions are taken out) is used for deciding child support. Many people make the assumption that child support is based on the earned income of a parent. This is one area where the welfare of the child has prompted provisions that encompass both earned and unearned income of a parent. Unearned income is any money that increases the net worth someone that resulted from passive sources, such as interest earned on investments or rental property income. It's all counted, as you can see below:
- Earned income from a job, including tips, overtime, commissions, deferred compensation, etc.
- Interest income.
- Income from business interests.
- Gambling winnings (including lottery).
- Spousal support (from a previous relationship).
- Workers' compensation disability wages, lump sum settlements, and structured settlements.
- Unemployment pay.
- Income from a trust (estate trusts).
- Military pay of all types.
- In some cases, even the income of the new spouse is used to determine the support payment for a previous relationship.
Uncovering Assets
It's vital that divorcing parents insist on full financial disclosure of finances when it comes to determining child support payments. It's expensive to raise a child and if you fail to identify some of your spouse's income it will be to the detriment of your child. Part of a divorce is financial disclosures. That means that both parties must provide financial documentation like bank statements, profit and loss statements, investment account information, deeds and titles to property, and more. If you suspect your spouse of hiding or attempting to hide assets for the purpose determining child support, spousal support, property settlements, or any other reason, request the services of a forensic accountant and have your spouse issued a subpoena to submit the information.
Speak to your child support attorney to learn more about determining child support for your minor-aged children.
