Calculating a spouse’s income in order to determine the appropriate amount they should pay for spousal support is easy if the spouse is an employee who earns a set salary each year. It becomes complicated however if the spouse is self-employed or if the spouse receives annual bonuses or other forms of non-monetary compensation.
Unlike child support, spousal support is usually determined at the date of settlement and is not varied annually based on the payor’s income. Because of this we often need to estimate what the payor spouse’s future income will be. If the spouse receives an annual bonus based on performance this may be a difficult task. Some spouses may also receive other incentives such as stock options, low interest loans, cars, etc. and the value of all of those benefits needs to be considered before determining the spouse’s income.
If the spouse is self-employed and operates their own business then often their company will pay part or all of their personal expenses such as vehicle expenses, cell phone and entertainment. The personal use component of these expenses needs to be added back to their income for guideline purposes to determine the appropriate amount of spousal support that should be paid.
Deborah A. Todd
