Imputation of Income

In a recent published (precedential) decision, Gormley v. Gormley, the Appellate Division cleared up confusion between two prior cases that dealt with the impact of a determination of disability…
Continue Reading As if it Wasn’t Clear the First Time, The Appellate Division Rules On the Impact of a Social Security Administration Disability Determination on Support- Again

Reading the recently unpublished (not precedential) Appellate Division matter of Connaughton v. Connaughton  brought me back to my days of toiling as an account executive at an advertising agency in Manhattan. Our team often worked long hours and frequently traveled for client meetings, commercial shoots, and the like.

Advertising also was and remains notorious for forcing account and creative executives to switch from agency to agency in order to make more money over time.  For instance, a person who just joined an agency may be making tens of thousands of dollars more than a similarly situated person who started with and remained at the same agency throughout their career for no other reason than that the newly hired person came from a different agency.

The income situation in Connaughton was interesting in that Brian’s historical income increased as he frequently switched jobs and moved up the proverbial ladder.  Similarly interesting was Elizabeth’s income growth, which stalled once she left the workforce and gave birth to the parties’ child.  Specifically, the parties married in 1995, and a year later, Brian obtained a job with J. Walter Thompson while Elizabeth commenced a period of freelance work that lasted throughout the remainder of the marriage.…

Continue Reading Imputation of Income in the World of Advertising

I recently heard a person say that their spouse believed his alimony and child support would be based solely on his salary.  I am sure he would like that but that statement is wishful thinking at best.  If he was correct, several hundred thousand dollars each year would be his alone and not considered for support.  Aside from potentially being unfair, it is not the law.

In fact, in New Jersey, the definition of income from support purposes includes all sources of income.  In fact, the Child Support Guidelines includes, but is not limited to 23 possibilities for income, as follows:

a. compensation for services, including wages, fees, tips, and commissions;
b. the operation of a business minus ordinary and necessary operating expenses (see IRS Schedule C);
c. gains derived from dealings in property;
d. interest and dividends (see IRS Schedule B);
e. rents (minus ordinary and necessary expenses – see IRS Schedule E);
f. bonuses and royalties;
g. alimony and separate maintenance payments received from the current or past  relationships;
h. annuities or an interest in a trust;
i. life insurance and endowment contracts;
j. distributions from government and private retirement plans including Social Security, Veteran’s Administration, Railroad Retirement Board, deferred compensation, Keoughs and IRA’s;
k. personal injury awards or other civil lawsuits;
l. interest in a decedent’s estate or a trust;
m. disability grants or payments (including Social Security disability);
n. profit sharing plans;
o. worker’s compensation;
p. unemployment compensation benefits;
q. overtime, part-time and severance pay;
r. net gambling winnings;
s. the sale of investments (net capital gain) or earnings from investments;
t. income tax credits or rebates (excluding the federal and state Earned Income Credit and the N.J. homestead rebate);
u. unreported cash payments (if identifiable);
v. the value of in-kind benefits; and
w. imputed income

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Continue Reading If You Think Your Alimony or Child Support Will Be Based Solely on Your Salary, Think Again