Is “Imputed” Income an Issue When Determining Alimony and Child Support in Your New Jersey Divorce? Make Sure that You Are Well Prepared
In some cases, that is not really an issue, because each party is earning an income which is reasonable under the circumstances.
In many cases, however, it is a major issue because one party asserts that the court should “impute” an income to the other party who is allegedly “underemployed” (not earning as much as he/she ought to be earning) or perhaps not working at all.
A New Jersey family court judge may impute income to either party if the judge finds that he/she is voluntarily unemployed or underemployed without just cause.
How does the New Jersey family court then decide how much income to impute to that party? Very often, the court is assisted by a Vocational Evaluation which is obtained by the other party from an expert. Of course, the party who is alleged to be unjustly unemployed or underemployed can also obtain his/her own Vocational Evaluation.
New Jersey family court judges are afforded a great deal of discretion in making that decision which, New Jersey appeals courts have consistently recognized, can’t be made with precision or exactness.
For example, in one case which was just decided by a New Jersey appeals court, both the husband and the wife were in their 50’s and had been trained as medical doctors. During the marriage, they had adopted two (2) children who were teenagers at the time of the divorce.
The husband was a radiologist who had earned an average of over $400,000 in the years before the parties’ divorce, but whose business had been destroyed by a flood in 2012. He asserted that he had only been offered one job, at an annual salary of $160,000, and therefore had enrolled in a Masters of Public Health program.
The husband’s expert testified that if after completing that program, he was accepted into a fellowship program, the husband could expect to earn $214,000 annually. Otherwise, the husband could likely earn between $146,000 and $201,000 as a medical director serving in an administrative capacity.
The wife had worked as a physician until the parties adopted the first of their two (2) children—both of whom suffered from certain disabilities and had special needs—and had not worked outside the home for the 17 years prior to the commencement of the divorce trial.
The New Jersey family court judge imputed annual income of $312,000 to the husband, but did not believe that the wife should be imputed with any earned income at that time.
The New Jersey appeals court affirmed the trial judge’s conclusions. It cited to the broad discretion which New Jersey family court judges are given in making these types of determinations, and stated that an appeals court should not overturn such a decision unless the underlying findings are inconsistent with or unsupported by competent evidence.
This case illustrates how important it is for you to be represented by knowledgeable and experienced legal counsel in your New Jersey divorce case.
Salvaggio Law Group devotes its entire practice to New Jersey Divorce and Family Law matters, including those in which the income of one or both parties has been a significant issue. If you want to talk, please call us at 973-447-4981 or fill out the Contact Form on our firm’s website.