With your recent divorce, you must now pay child support. Of course, you want to do everything you can to take proper care of your child, but you wonder what determines your child support amount.
Kentucky’s judges examine several factors when deciding how much parents should pay in child support. Learn those factors so you can prepare your budget and finances accordingly.
Earned income and compensation
Courts consider all income earned through employment and similar efforts:
- Carried interest
- Salary
- Employment perks
- Partnership distributions
- Deferred compensation
- Retirement account corporate contributions
Earned income also includes recurring passive income received through investment dividends.
Income tax returns
With your federal income taxes, judges not only examine your most recent filing, but they may also look for received income that you neglected to report. This is common when a person’s opulent lifestyle does not reflect the fairly modest income reported on a tax return. Courts want to know what other means the person has of financially supporting him or herself and a family.
Potential income
Judges consider how much a parent could earn and how much that individual currently earns when determining child support. For instance, perhaps you earned an engineering degree at a prestigious institution and used to work at an engineering firm, but you currently work as a part-time barista. Under such circumstances, a judge may use your engineering salary to decide your child support amount rather than your current earnings.
Parents may also receive substantial financial support from family. If so, a court may impute a regular contribution as income and factor it into the child support amount.
Consider working with the other parent to decide a fair amount for child support. Working together may make it easier for you to meet your new financial obligation.