Child support is calculated using the income of both parents. Why both? This is to ensure that the child will receive the same financial care if their parents remained together. When it comes to figuring out what numbers to provide for income, this calculation process gets tricky. Some sources of income that are non-recurring or not taxable, should be counted when calculating child support.
What sources of income count toward child support?
Net income encompasses all earnings from various sources, including:
- Wages & Salaries (overtime and bonuses included)
- Gifts – Regular gifts that are consistently given includes, but are not limited to bill payment, cash. Etc.
- Personal Injury Settlement – Compensation awards provided for lost wages.
- Investment Income – Sometimes the earnings from investments are fairly substantial, allowing one parent to not have to work.
- Self-employment Income (rental properties, business income, etc.) – This includes ‘side jobs’ or ‘gigs’, any income provided by independent work.
- Trust Distributions – If a parent received money from a trust, their child is entitled to a portion.
- Employment Perks – Includes but is not limited to, company car, company housing, and bonuses. Any perk that is employment related and provides a parent with extra income.
- Rental Property Income – Any income made from properties owned by a parent.
- Unemployment Compensation
- Social Security and disability benefits
In short, almost all income made by a parent is considered in a child support calculation. It is important to include all income, even when one is considered a gift.
“In Rogers, a mother sought to have a father’s child support obligation increased.. The father earned a net income of $15,000 from a teaching job, and he received approximately $46,000 in gifts and “loans” from his parents each year. Id. at 133. He did not have to repay the “loans.” Id. at 134. The trial court held that the $46,000 the father received constituted gifts that qualified as income and set support at 20% of $61,000 in accordance with the guidelines for a single child. Id. at 133. The supreme court affirmed that the “loans” were in effect gifts, all of which constituted income. Id. at 137. The supreme court looked at the plain meaning of the word “income” in the statute. Id. at 136-37. The supreme court held that the continuous stream of gifts and loans were a viable source of funds to provide a standard of living to the father that he could not sustain on a net salary of $15,000, and therefore the gifts and the loans from the parents qualified as income. Id. at 140.” Rogers, 213 Ill. 2d at 131
