California Court Reviews Definition of “Income” under State Guideline for Child Support Calculation

law seriesThe California Family Code devotes an entire section to the regulation of child support. Under the law, a parent’s first and principal obligation is to support his or her minor children according to the parent’s circumstances and station in life. Therefore, when a couple seeks to separate and divorce, the court will attempt to fashion a child support arrangement that suits the family’s circumstances. In order to do so, courts are required to consult and apply the Family Code’s Statewide Uniform Guideline. This is a crucial part of a divorce case that will ultimately dictate the parties’ financial interests going forward. To protect your family’s legal and financial rights, you are strongly encouraged to contact a local San Diego family law attorney as early in the case as possible.

Under the mandatory formula for calculating child support, courts will look at each parent’s “income from whatever source derived.” This includes a host of sources, including but not limited to “commissions, salaries, royalties, wages, bonuses, rents, dividends, pensions, interest, trust income, annuities, and workers’ compensation benefits,” among many other items. The statute clearly contemplates additional sources of income not identified therein. In fact, at least one California case has pointed out that the codified items are “by way of illustration only.”

In a recent California divorce case, the court was asked to determine whether payments made by the wife’s family (either directly to her or to third parties on her behalf) might be considered “income” under the statute for the purposes of calculating child support, spousal support, and attorney’s fees. Here, the couple got married in 1991 and have six children. The wife filed for divorce in December 2012. In 2013, during the pendency of the case, the wife sought custody and spousal and child support, based on the mandatory child support guidelines. In response, the husband asked the court to deny her request for spousal support and to impute the money the wife received from her family as income for the purpose of calculating child support.

It seems that the wife’s family made payments directly to her and to third parties to help pay for the children’s education and other living expenses. The trial court found, among other things, that these payments made by the wife’s family were “regular and recurring cash gifts” and could be treated as income for calculating both spousal and child support. In so finding, the court refused to award the wife (or the husband) spousal support and awarded her only $1,500 a month in child support. The wife appealed.

The court of appeals reversed this part of the ruling, concluding that the lower court abused its discretion in determining that the family’s direct payments to the wife were income within the meaning of the statute, due to the variability of the payments. The court reasoned that the number of payments and relative amounts varied each month. They were not periodic or regular. Furthermore, the court concluded that the indirect payments to third parties should also not have been treated as income because they were “irregular and outside the traditional concept of income as a recurrent, monetary benefit…”

The court remanded the matter back to the trial court for further proceedings. This case illustrates the importance of understanding the statutory framework covering a child support request, and how that knowledge can affect a financial award in divorce. For more than 20 years, Roy M. Doppelt has been representing clients in child support and other family law matters in San Diego and throughout Southern California. For a free consultation with a dedicated and experienced family law lawyer, contact Doppelt & Forney through the law firm’s website or give us a call toll-free at (800) ROY IS IT (769-4748).

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California Court Reviewed Impact of Family Law Judgment in Child Support Case