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Should corporate perks affect child support payment amount?

Posted by Thomas Pettinicchi of D'Amico & Pettinicchi, LLC on Jun 12, 2013 in Child Support

When two parents divorce or split up, one of the most contentious aspects of breaking up is figuring out how to do so without causing any unnecessary strain on a child. In general, parents will need to figure out not only who will care for the child and when, but also who will contribute financially to the child's life with child support payments.

The process of determining child support may sound straightforward, but there are a number of questions that many Connecticut parents have when it comes to calculating these payments. One question that often comes up refers to the sources of income that are used to calculate monthly requirements. For example, can corporate benefits be considered income?

This very issue came up in a recent case in another state. Sources report that a man who previously made $143,000 a year is arguing that his $2,198 monthly child support payments should be adjusted and lowered. He says that his annual income has dropped to $75,000.

However, his employer is reportedly paying for his luxury car, tickets to sporting events and even his cellphone. 

Initially, two lower courts ruled that the perks, which total about $16,000 a year, were considered to be a part of his gross income and therefore made no adjustment to his monthly payments. The case is now in front of the state's Supreme Court. 

There are a number of factors at play here. In addition to the pay cut and the corporate perks, records indicate that the man not only works for the company, which was founded by his mother, but he also sits on the board. The Court is expected to make a ruling later this year.

State laws can vary widely when it comes to calculating child support amounts. In Connecticut, all sources of income and deductions are taken into consideration, but it can be confusing for parents to know what is considered income. In many cases, an attorney can help parents understand their options when it comes to making or pursuing child support payments. 

Source: The Columbus Dispatch, "Dad doesn't want his perks to count in calculating child support," Catherine Candisky, June 12, 2013