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Artificially modifying income: Why efforts to trick the court about your income usually will not work

Near countless hours have been spent fighting over how much alimony or child support parties should pay and receive in a divorce action. While in Utah the legislature has established an equation to set child support that is based on the parties’ incomes and numbers of overnights with the children, parties still spend enormous effort, money, and time on it and attend court hearings to determine what their incomes actually are. Utah Code Title 78B, Chapter 12 establishes what is included as gross income when establishing child support. Without getting into too much detail, it is based on gross income.

Yes, gross income. No, that’s not crazy or unfair. Utah’s child-support calculations start with gross income but take into account taxes in making the child support determination, so that no one is imputed his or her gross income as his net income. Relax (for now).

Alimony in Utah, however, is not as easy to calculate as child support, as it has many factors the court must analyze before ordering a party to pay spousal support. Alimony, like child support, is based in part on the income of the parties. See Utah Code § 30-3-5. As with child support, it is common for parties in a divorce to fight over what their incomes and/or income potentials are.

So what happens if you’re underemployed, unable or unwilling to get a job which pays you to your full potential? It is common for people in the middle of a divorce to suddenly have a change in income, drastic or subtle. The change in income arise from an innocent cause or can be an effort of a party to avoid a high child support award.

I have seen parties in divorces lose their jobs, and have seen parties purposely stop working in order to try and influence the court regarding their income. The parties often purposely stop working in an effort to make the court think their income level is lower, so that the court will order support payments (child support and alimony) to be lower. Will it work?

The answer is probably not (nor should it—it’s dishonest). The court is charged with determining what your income is or should be, if you and your spouse won’t or can’t agree on this issue. The court has discretion to decide what your income level should be. Courts will often look at your work, education, and income history to determine what you have earned in the past and what you can be expected to earn prospectively. For example, if you have an advanced degree and have been earning $100,000 for 5 years, and suddenly your income drops to $30,000, the court could (and likely would) find that you are underemployed and may order support payments based on your historical income, even when you are not earning what you earned historically. If your spouse has been earning $35,000 for 10 years, but you feel your spouse should be earning $100,000, the court is unlikely to set an income level at your desired level. But your spouse may have just completed college, or he or she may purposely quit a job in the middle of a divorce in an effort to decrease income artificially.

The courts want to prevent spouses from gaming the system. Courts also use the same analysis for your spouse/ex-spouse’s income.

Consequently, the courts will usually set incomes based on historical levels. Now this is not always the case. There are many factors the court considers, and if your income has naturally dropped or decreased through no fault of your own, or if your income spiked for one year only, and dropped to its normal level the court may set your income level at its average level. But remember: if you want the court to be aware of this you have to prove it. You can’t expect the court to sympathize with you based upon your word over that of your spouse. You’ll need documentation. You will need the testimony of your former employer and coworkers, others who work in the same industries as you do, and if your income decreased due to a mental or physical ailment, you will need your doctor, perhaps of vocational specialist and other expert witnesses to vouch for you.

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