Annual Bonuses

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Re: Annual Bonuses

Unread postby Snowblower » Mon Dec 11, 2017 10:39 pm

[quote="lionel2013"

What are you looking at, $ amounts, in terms of CS and SS?[/quote]

Hearing is this week and they are planning on asking for 283 per week SS and 325 per week CS. My worksheet states this number will be 251 SS and 151 CS.

I can't really find a clean cut calculation as my states use a worksheet and additional assumed bonus income is not part of those calculations.
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Re: Annual Bonuses

Unread postby hoosier_dad » Mon Dec 11, 2017 11:14 pm

Snowblower wrote:Hearing is this week and they are planning on asking for 283 per week SS and 325 per week CS. My worksheet states this number will be 251 SS and 151 CS.


Your STBX is employed right? I'm assuming that's a yes since she was having an affair with her boss. If she is employed then spousal maintenance should be off the table, not even a discussion point. Spousal Maintenance in Indiana is by statute rehabilitative only and capped at 3 years, sole purpose is to get a former spouse employed again.

Snowblower wrote:I can't really find a clean cut calculation as my states use a worksheet and additional assumed bonus income is not part of those calculations.


The calculation is pretty straightforward. Average your gross income including bonus for the last 3 years and use that for your income in the CS worksheet. IMO that is what a judge is most likely to use. Calculating a percentage of future bonuses provides another means of potential conflict that the Family Court generally tries to avoid.
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Re: Annual Bonuses

Unread postby Snowblower » Mon Dec 11, 2017 11:58 pm

Yes, she is employed part time at ~10 per hour as an aide but was employed for $20 an hour about 2 years ago so I thought this was off the table as well. That is what I thought as well from reading around. My attorney has plans to challenge it but told me to be prepared.

Like, I said by taking an average of the last three years will really hurt me because two years ago I got paid a very nice bonus that will really inflate those averages. I am not expecting that this year or the next.
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Re: Annual Bonuses

Unread postby LovingDadof2 » Tue Dec 12, 2017 7:51 am

Snow, what does your state specific CS guidelines say? Surely this is something you can easily find online. Does it say it will average the past 3 years salary? Does it state gross income and gross income shall include bonuses?

If so, stop worrying about it as there is nothing you can do. You are wasting your time and energy over something you cannot control. I am just a guilty as anyone for doing this, but as soon as your realize this and let it go, the burden, stress and worrying should start to ease. If not, then start preparing your counter argument by reciting the State statue.
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Re: Annual Bonuses

Unread postby hoosier_dad » Tue Dec 12, 2017 8:36 am

Indiana Child Support Guidelines do have a section on irregular income, and provides a calculation to determine the appropriate percentage:

Overtime, Commissions, Bonuses and Other Forms of Irregular Income.
There are numerous forms of income that are irregular or nonguaranteed, which cause difficulty in accurately determining the gross income of a party. Overtime, commissions, bonuses, periodic partnership distributions, voluntary extra work and extra hours worked by a professional are all illustrations, but far from an all‑inclusive list, of such items. Each is includable in the total income approach taken by the Guidelines, but each is also very fact sensitive.

Each of the above items is sensitive to downturns in the economy. The fact that overtime, for example, has been consistent for three (3) years does not guarantee that it will continue in a poor economy. Further, it is not the intent of the Guidelines to require a party who has worked sixty (60) hour weeks to continue doing so indefinitely just to meet a support obligation that is based on that higher level of earnings. Care should be taken to set support based on dependable income, while at the same time providing children with the support to which they are entitled.

When the court determines that it is not appropriate to include irregular income in the determination of the child support obligation, the court should express its reasons. When the court determines that it is appropriate to include irregular income, an equitable method of treating such income may be to require the obligor to pay a fixed percentage of overtime, bonuses, etc., in child support on a periodic but predetermined basis (weekly, bi‑weekly, monthly, quarterly) rather than by the process of determining the average of the irregular income by past history and including it in the obligor's gross income calculation.

One method of treating irregular income is to determine the ratio of the basic child support obligation (line 4 of the worksheet) to the combined weekly adjusted income (line 3 of the worksheet) and apply this ratio to the irregular income during a fixed period. For example, if the basic obligation was $110.00 and the combined income was $650.00, the ratio would be .169 ($110.00 / $650.00). The order of the court would then require the obligor to make a lump sum payment of .169 of the obligor's irregular income received during the fixed period.

The use of this ratio will not result in an exact calculation of support paid on a weekly basis. It will result in an overstatement of the additional support due, and particularly so when average irregular income exceeds $250.00 per week or exceeds 75% of the regular adjusted Weekly Gross Income. In these latter cases the obligor may seek to have the irregular income calculation redetermined by the court.

Another form of irregular income may exist when an obligor takes a part‑time job for the purpose of meeting financial obligations arising from a subsequent marriage, or other circumstances. Modification of the support order to include this income or any portion of it may require that the obligor continue with that employment just to meet an increased support obligation, resulting in a disincentive to work.

Judges and practitioners should be innovative in finding ways to include income that would have benefited the family had it remained intact, but be receptive to deviations where reasons justify them. The foregoing discussion should not be interpreted to exclude consideration of irregular income of the custodial parent.



But when you look into Indiana case law you see frequent mentions of 3 or 5 year averages to determine gross income. From personal experience I got no traction with attempting to apply the percentage calculation, judge wanted nothing to do with that as it provides a potential source of conflict each year when bonuses are paid.
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Re: Annual Bonuses

Unread postby lionel2013 » Tue Dec 12, 2017 1:09 pm

One method of treating irregular income is to determine the ratio of the basic child support obligation (line 4 of the worksheet) to the combined weekly adjusted income (line 3 of the worksheet) and apply this ratio to the irregular income during a fixed period. For example, if the basic obligation was $110.00 and the combined income was $650.00, the ratio would be .169 ($110.00 / $650.00). The order of the court would then require the obligor to make a lump sum payment of .169 of the obligor's irregular income received during the fixed period.


So as I said, a percentage. Or a fraction. Definitely not a fixed amount or an average.
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Re: Annual Bonuses

Unread postby Snowblower » Tue Dec 12, 2017 1:15 pm

hoosier_dad wrote:
But when you look into Indiana case law you see frequent mentions of 3 or 5 year averages to determine gross income. From personal experience I got no traction with attempting to apply the percentage calculation, judge wanted nothing to do with that as it provides a potential source of conflict each year when bonuses are paid.


Exactly what I was looking for. Based on this...it will be about 15% assuming it is imputed to where it should be. So lets say ~10K bonus that is paid out next year I need to plan on giving her about 15%. The reason judges would shoot for the averages instead of irregular pay periods is to reduce the occurrence and only revisit this once every 3 to 5 years as you say. On a good year that will be great but if goes expected (not a good bonus) I will be overpaying in what is an already difficult situation.

Assuming I can get the mediator to buy off on doing the %, how is that paid? I write a check for 15% of the gross value of the bonus or does it have to go through the child support system? What would be a good method to convince them that this is not a high conflict method? Taxes on that as a whole other topic I guess.

Seems petty but right now I am preparing for mediation and the OC has every single little penny targeted so I need to have a plan on this and about 50 other things......
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Re: Annual Bonuses

Unread postby lionel2013 » Tue Dec 12, 2017 2:33 pm

Assuming I can get the mediator to buy off on doing the %, how is that paid? I write a check for 15% of the gross value of the bonus or does it have to go through the child support system? What would be a good method to convince them that this is not a high conflict method? Taxes on that as a whole other topic I guess


You write a check directly to your X, you don't go through the disbursement agency - and now I'm wondering why I need to repeat myself; have you read what I already posted, twice?

Moreover: I strongly disagree with those who are telling you to just bend over and propose averages. I don't understand this at all. You have absolutely nothing to lose by proposing a percentage, there is no reason I can think of why that would make a judge mad, or your X mad. None whatsoever. One thing I do know, however, is that if you do not propose paying a percentage, based on what others have said, you won't get it.

What "sources of conflict" are we talking about here? If it's a mutually-agreed (or ordered) percentage, same percentage every year, it should simplify things, - in fact, it should remove any reason for conflict.

I just don't get it.
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Re: Annual Bonuses

Unread postby lionel2013 » Tue Dec 12, 2017 2:37 pm

Snowblower wrote:
hoosier_dad wrote:
But when you look into Indiana case law you see frequent mentions of 3 or 5 year averages to determine gross income. From personal experience I got no traction with attempting to apply the percentage calculation, judge wanted nothing to do with that as it provides a potential source of conflict each year when bonuses are paid.


Exactly what I was looking for. Based on this...it will be about 15% assuming it is imputed to where it should be. So lets say ~10K bonus that is paid out next year I need to plan on giving her about 15%. The reason judges would shoot for the averages instead of irregular pay periods is to reduce the occurrence and only revisit this once every 3 to 5 years as you say. On a good year that will be great but if goes expected (not a good bonus) I will be overpaying in what is an already difficult situation.

Assuming I can get the mediator to buy off on doing the %, how is that paid? I write a check for 15% of the gross value of the bonus or does it have to go through the child support system? What would be a good method to convince them that this is not a high conflict method? Taxes on that as a whole other topic I guess.

Seems petty but right now I am preparing for mediation and the OC has every single little penny targeted so I need to have a plan on this and about 50 other things......


Again, from the Indiana statute: <<One method of treating irregular income is to determine the ratio of the basic child support obligation (line 4 of the worksheet) to the combined weekly adjusted income (line 3 of the worksheet) and apply this ratio to the irregular income during a fixed period. For example, if the basic obligation was $110.00 and the combined income was $650.00, the ratio would be .169 ($110.00 / $650.00). The order of the court would then require the obligor to make a lump sum payment of .169 of the obligor's irregular income received during the fixed period.>>

So you do not have to get the mediator to buy off on doing anything, it's part of the statute.
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Re: Annual Bonuses

Unread postby hoosier_dad » Tue Dec 12, 2017 4:07 pm

The choice of ratio vs. average is entirely up to the judge, and from my own experience and attorney feedback the ratio was a no go. Could be my specific county and judge, but in looking at Indiana case law it appears averaging the income over several years is by far the norm.
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