On behalf of Stange Law Firm, PC posted in Child Support on Friday, November 18, 2016.
The amount of child support payments ordered by Illinois courts is determined primarily by the income of the spouses. This is termed ‘income driven” child support. This makes it very important for parents to understand what constitutes income under the law. While some income sources may be obvious, many others are less so.
In general, state guidelines seek to define income as inclusively as possible. This means that a great variety of things are considered income. Often, these goes far beyond a weekly paycheck. For example, income received from pensions and trusts can be included as can the income from the interest on investments. Benefits that are not monetary in nature are also factored into the calculations. This is done by considering how much these perks, such as a company car or free housing, lower the overall cost of living for the parent.
Determining child support can get especially complicated when unrealized income is a factor. Unrealized income is income that is reported to the IRS as income for tax purposes but is never actually received by the person. A common example of this is the interest earned from an IRA. Most often, this interest is invested back into the IRA and never actually given to the person. Whether or not it is factored as child support income varies by state, and case law can change unexpectedly.
Parents who are facing child support orders will want to be sure they are paying a fair amount based on their actual income. Due to the sometimes complicated nature of income calculations, a parent may wish to seek the counsel of an attorney for help.
