Child Support and Imputed Income

 Posted on June 10, 2016 in Child Support

Child support determinations can be filled with tension, and the amount of support is often hotly contested. Child support calculations in Illinois are based on each parent’s earnings, and sometimes, one parent tries to evade responsibility for support payments by hiding income.

Imputing Income

If the judge in a child support proceeding suspects that one parent is trying to avoid paying child support, Illinois law has a mechanism to ensure fairness — imputing income. When a Court imputes income, a parent is assigned a higher income for purposes of calculating child support. This action is appropriate when there is doubt as to the accuracy of the parent’s reported income and evidence shows that the parent is or could be earning more than reported.

There are several reasons to impute income in Illinois. Imputing income may be appropriate when a parent conceals or fails to report his or her earnings, or when the parent is voluntarily unemployed or underemployed.

Hiding Income

In any child support calculation, the parents must report their full income to the Court, so the calculation can be made accurately. Parents may conceal income through money laundering or simply failing to report cash income. Money laundering is the transferring of money through a third party in order to conceal its source. For example, a parent who owns a business may order that business earnings be paid to a trusted associate, who then loans money to the parent or pays the parent’s expenses as a favor.

If the parent is a contractor or service employee, he or she may receive a significant portion of his or her income in cash payments. Parents are required to report all income, including cash earnings, to the Court for child support calculations. If parents fail to report these earnings, the Court may examine bank records, pay stubs, or the employer’s records for evidence of income.

Voluntary Unemployment or Underemployment

Sometimes, a parent may not hide income, but rather voluntarily earn less in an effort to avoid child support. Voluntary unemployment or underemployment can be cause for the Court to impute income to one parent in making a child support determination. The underemployment, however, must be voluntary and for the purpose of avoiding child support payments, rather than for health or other valid reasons.

Voluntary unemployment can include intentionally getting fired, quitting or refusing to look for a new job. Voluntary underemployment may include delaying a bonus or commission, refusing a raise or promotion or failing to take an employment opportunity such as a higher-paying job. The Court will look at education, vocational training, job skills and employment history and decide whether a reasonable effort could result in higher earnings.

Calculating Imputed Income

When calculating imputed income and the child support amount, the Court may take prior earnings into account. If there is insufficient information regarding prior income, the Court may calculate the earnings from a full-time minimum wage job and use that number as the parent’s imputed income. If a parent is voluntarily unemployed, the Court may require him or her to keep a diary reporting search efforts to the Court. If, however, the parent disagrees with the Court’s calculation, then he or she may present evidence to the Court that justifies the reported income amount.

If you believe that your co-parent is concealing income in your child support case, please contact skilledPalatine family law attorney Nicholas W. Richardson for a free consultation.

Resources:

http://illinoiscourts.gov/R23_Orders/AppellateCourt/2012/3rdDistrict/3100753_R23.pdf

http://www.ilga.gov/legislation/ilcs/fulltext.asp?DocName=075000050K505.1