Income Imputed for Child Support - An Update
Friday / August 03, 2007
Another court holds that courts may "impute income
based upon the party's past income or demonstrated
earning potential."
In a prior blog post, we examined the
issue of imputed income for child support
purposes. In a new case, the New York Court of
Appeals, Appellate Division, upheld a Support
Magistrate's determination that a father must
pay child support based on what he was capable
of earning rather than what he actually was
earning.
At the child support hearing, the father testified that
he had a bachelor of science degree and a master's degree in education. He was also licensed in real estate and insurance. He had previously been a high school teacher and worked in real estate. He also operated an insurance business from 1986 to 1996. In 1996, the last year that he was involved with running his business, he earned an income of $101,000.
After selling that business, the father tried his hand at consulting but was not successful. He said that he tried to find work over the next three years but succeeded only at landing a job selling steel components for $500 per week just three days before the support hearing.
The Support Magistrate was not impressed. The evidence included that
• the father's claimed annual household expenses were approximately double his claimed annual income in 2004 and 2005.
• he did not use savings or borrow money to pay expenses greater than his average annual income.
• he did not liquidate any of his investments.
• he had no outstanding balance on his home equity line of credit.
• his credit card statements showed no unpaid balances of a size and nature to correspond to his household expenses.
On these facts, the Support Magistrate imputed an annual income to the father, reasoning that the father could earn approximately $96,000 a year because of his education and his professional license in real estate, testimony regarding his previous earnings, and the testimony of an expert regarding the father's ability to earn an income.
At the child support hearing, the father testified that
he had a bachelor of science degree and a master's degree in education. He was also licensed in real estate and insurance. He had previously been a high school teacher and worked in real estate. He also operated an insurance business from 1986 to 1996. In 1996, the last year that he was involved with running his business, he earned an income of $101,000.
After selling that business, the father tried his hand at consulting but was not successful. He said that he tried to find work over the next three years but succeeded only at landing a job selling steel components for $500 per week just three days before the support hearing.
The Support Magistrate was not impressed. The evidence included that
• the father's claimed annual household expenses were approximately double his claimed annual income in 2004 and 2005.
• he did not use savings or borrow money to pay expenses greater than his average annual income.
• he did not liquidate any of his investments.
• he had no outstanding balance on his home equity line of credit.
• his credit card statements showed no unpaid balances of a size and nature to correspond to his household expenses.
On these facts, the Support Magistrate imputed an annual income to the father, reasoning that the father could earn approximately $96,000 a year because of his education and his professional license in real estate, testimony regarding his previous earnings, and the testimony of an expert regarding the father's ability to earn an income.
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