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post >> Imputing Income – When is your “income” not really your income?

Imputing Income – When is your “income” not really your income?

matrimonial issues

Child support obligations are determined based on the income of parents. However, your income as shown on your tax return, may not be the same as your income for family law purposes.

S. 19 of the Child Support Guidelines permits a court to impute income to a party if it finds that the party is earning or can earn more income than they claim. That is, in certain circumstances, the Court may find your income to be more that the income you are earning or declaring to be earning.

Why impute income?

Imputing income is one method by which the court gives effect to the joint and ongoing obligation of parents to support their children. In order to meet this obligation, the parties must earn what they are capable of earning. If they fail to do so, they will be found to be intentionally under-employed and income may be imputed to them

The Courts have found that the fundamental obligation of to support his or her children, takes precedence over the parent’s own interests and choices, and that a parent will not be permitted to knowingly avoid or diminish, his or her obligation to support his or her own children.

There are cases where a party’s income tax return simply does not reflect their actual income; for example, self-employed persons either may not declare all of their income, or may unreasonably deduct expenses from their income. The Court can impute income in these circumstances as well. However, we will discuss here those cases where a parent is declaring all of his or her income, but the other parent is claiming that they should be earning more

How does the Court impute income?

The Courts will examine the following three questions in considering a request to impute income:

    1. Is the party intentionally under-employed or unemployed?
    2. If so, is the intentional under-employment or unemployment required by virtue of his or her reasonable educational needs?
    3. If not, what income is appropriately imputed?

Once a party seeking the imputation of income presents the evidentiary basis suggesting that there is at least the appearance of a case, the onus shifts to the individual seeking to defend the income position they are taking.

It is important to note that the Court does not consider whether there is an intention to evade child or spousal support,; instead the Court looks at whether is there is a voluntary decision to embark on a course of action that results in the parent earning less income than the Court finds that he she or she could reasonably earn.


John has worked a computer engineer for twenty years. He and Mary have three children. The parties are separated, and the three children live with Mary. John makes $125,000.00 per year and he pays Marythe sum of $2,313.00 per month pursuant to Court order .The amount of child support is fixed by reference to the Table amount set out in the Child Support Guidelines for John’s income.

John has always loved art, and he is a good painter. He now has the opportunity to teach art at a local community college for an annual salary of $60, 000.00. The amount of child support at that level of income under the Child Support Guidelines is $1192.00 per month, or $1121.00 less per month the existing Order.

John is a good father and has no difficulty paying child support. However, he wants to lower his child support payments to correspond to his new income. Mary opposes this. She says that this is unfair to the children. She says that she does not particularly like her job either, but she works at it so that she can support the children. She wants John to continue paying the old amount of support.

Each case will depend on its own facts, and this example presents a simplified version of the factors which the Court will examine. Many people might be surprised to learn that in this scenario, a Court may well find, that despite John’s personal wishes and good faith, he is not working to his capacity as an art teacher, and will make him pay support based on his income as a computer engineer.

In this area, as in most other areas of family law, the Courts prioritize the needs and interests of children over adults. They are bound to do so under the terms of the existing legislation and the jurisprudence. We may query the effect of such a result in this case on John’s parenting and the ultimate effect on the children, either as a result of the emotional strain of him working in a job that he does not want to do so he can pay the child support Order, or being required to pay an Order that he cannot afford because he has chosen to do a job he enjoys.

If either you would like to change jobs, or your spouse is requesting a downward revision of child support, R. P. Zigler law office can assist you to evaluate the relevant issues and prepare a plan of action. Contact us to arrange a consultation.

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