Page 53 - Family Law Services

Chapter 7

Support

Determination of Income

A determination of each party’s income is typically a prerequisite to the computation of spousal support
or child support, or both, under each state’s guidelines. The amounts and types of income that should be
included are determined by each state’s statutes and case law. Many states use the income as reported on
the couple’s income tax returns as a starting point from which other issues may be explored. Examples
include

• the deduction of noncash expenses;

• the deduction of lifestyle business expenses;

• the possibility of unreported income;

• depreciation and amortization;

• educational, travel, and entertainment expenses; and

• unreported cash receipts from businesses.

In addition to the previously mentioned examples, the following can also be utilized when calculating
income:

• Gifts

• Pension

• Retirement or annuity payments

• Social Security benefits

• Spousal support from another marriage

• Interest and dividends

• Rental income

• Income from royalties

• Trusts

• Estates

• Distributions or loans from pass-through entities

© 2020 Association of International Certified Professional Accountants 51