With the holidays quickly approaching, many are excited about the festive activities to come, and time spent with family. However, with this time of year can also come longer work hours and overtime in preparation for the Christmas price tag. Additionally, many are excitedly waiting and preplanning on how they will spend their yearly Christmas bonus. While this extra income seems straightforward for many families, for some, it means the complicated task of determining how this additional income will be divided up for child support.
Child support payments are a vital aspect of ensuring the financial well-being of children after a divorce or separation. In Indiana, the amount of child support is determined by the weekly gross income of the non-custodial parent, which can include salaries, wages, commissions, bonuses, social security benefits, and worker’s compensation benefits. But, this is not an exhaustive list, and other forms of income may be included. While determining the support amount may be a bit complicated, when it comes to irregular income sources like Christmas bonuses or overtime, things can become a bit more complex. In this blog post, we’ll explore the considerations and guidelines surrounding irregular income and Christmas bonuses in child support payments in Indiana.
Understanding Indiana Child Support Guidelines
In Indiana, child support payments are determined based on the “Income Shares Model.” This Model “is predicated on the concept that the child should receive the same proportion of parental income that he or she would have received if the parents lived together.” Thus, many factors determine the amount of child support that will be required, such as the number of children, the age of the children, and the income of both the custodial and non-custodial parents. This model ensures that children receive fair and proportionate financial support from both parents.
Irregular Income and Child Support
Indiana does not provide an exhaustive list of what is considered irregular income. Some examples that are provided are bonuses, overtime, commissions, periodic partnership distributions, voluntary extra work, and extra hours worked by a professional. Because these incomes are unpredictable, Indiana has provided courts and families with a more straightforward way to calculate how much additional child support is owed.
According to Commentary to Guideline 3A of the Indiana Child Support Rules and Guidelines, courts have much discretion in determining whether it is appropriate to include irregular income in an individual’s child support obligation. If the court determines that it is not appropriate to include the irregular income in the child support obligations, then the court should express its reasons why. But, if the court determines that it is appropriate to include an individual’s irregular income in their child support obligations, then the court has a lot of discretion regarding how to determine the amount.
Some of the ways in which a court may determine the amount of payment due may be to require the parent to pay a fixed percentage of their irregular income on a periodic basis, such as every two weeks or even monthly. Another and more complex way a court can determine the amount of irregular income due is by determining the ratio of the basic child support obligation to the combined weekly adjusted income, and then applying this ratio to the irregular income for that predetermined fixed period. As an example, if the weekly obligation was $200 and the combined weekly adjusted income was $1000, the court could require the parent to make a lump sum payment of .2 ($200/$1000) of the parent’s irregular income.
However, these are not the only methods used to determine the additional child support obligations. In fact, it is encouraged that “judges and practitioners should be innovative in finding ways to include income that would have benefited the family had it remained intact.”
Child support is a critical aspect of ensuring the well-being of children in the event of divorce or separation. When dealing with irregular income, such as Christmas bonuses, it’s important to follow Indiana’s child support guidelines and calculate average weekly income to maintain consistency in financial support. Additionally, deviations can be considered when necessary to address unique circumstances. Open communication between parents and the willingness to work together for the benefit of the child is crucial to navigating these challenges effectively. But, if you or someone you know needs assistance navigating this complicated issue, contact one of McNeelyLaw’s experienced Indiana family law attorneys who can assist you and your family during this holiday season.
This McNeelyLaw LLP publication should not be construed as legal advice or legal opinion of any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own lawyer on any specific legal questions you may have concerning your situation.