Annual Bonuses

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Annual Bonuses

Unread postby Snowblower » Mon Dec 11, 2017 2:07 pm

In a letter to my attouneys my STBX wife is asking for a share of my bonuses. I would maybe understand a portion of this for the year prior being when we were married but she is going to ask for this until I am no longer paying support when the kids are adults. They are performance based off of company and individual and can range between 0 to $40K however I have no idea what it is going to be until the beginning of the next year when earning report comes out. Is this practical and is there a way I can defend this? How much will she get?

Kids will be 50/50, state is IN.
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Re: Annual Bonuses

Unread postby LovingDadof2 » Mon Dec 11, 2017 2:51 pm

I believe it will be part of future CS calculations when you revisit every 2-3 years. In my State (NJ), bonus are included in the calculations so if IN is similar, then yes, the CS calculations will factor in your annual bonuses. Sorry, probably not the news you wanted to hear.
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Re: Annual Bonuses

Unread postby Snowblower » Mon Dec 11, 2017 3:05 pm

No, I get that fact that some bonus and pay structures are actually pretty fixed as to be income so it only makes sense that it is considered. I guess to refine the question is this done or can this be done at the time when bonuses are paid, be calculated in before child support based on historical or be done retroactively in lump or disbursed?

2 years ago I had a really really nice bonus. Based on company things we are not getting one of those for a long time so if they calculate that into child support and maintenance it is going to kill me.
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Re: Annual Bonuses

Unread postby lionel2013 » Mon Dec 11, 2017 3:22 pm

I am in the exact same situation. Because it is variable compensation, I proposed and the OC agreed that I pay her 20% of my net bonuses based on an accurate, agreed-upon calculation. This is how we've done it since 2014. Percentage is the key word here.

"Net" means after taxes and other mandatory deductions. But that's because it is for CS, in IL. For SS and/or in other states it may be gross. But the key word here is still percentage, paid directly by you (outside of the state disbursement agency), within x days after receiving, accompanied by copies of the pay slip and the calculation you used to get to that number.
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Re: Annual Bonuses

Unread postby lionel2013 » Mon Dec 11, 2017 3:27 pm

Just re-read your note, one more comment. I am paying this only as CS. The OC also asked a separate portion of my bonuses as SS, but the judge said no. It all depends how much else you are paying in SS and CS. I'm already paying a lot, so that's why the judge said no to more SS out of my bonuses.
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Re: Annual Bonuses

Unread postby Snowblower » Mon Dec 11, 2017 4:52 pm

Understood, if she asks for it for next year and every year past she will get it. How was the 20% calculated? It seems like most states would have a baked in calculation for this that. I think my plan is that I am not going to agree to make assumed bonuses and it will be any part of the CS/SS calculation but instead will come re-actively by x% such as you said is happening. Honestly I am not going to be able to afford giving her anything I am not earning a portion of myself as is.
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Re: Annual Bonuses

Unread postby grandet2 » Mon Dec 11, 2017 6:01 pm

Ignore her, you are paying support and will be paying CS.
In MI we take 3 year average if income is variable. stick to something like that and hey maybe you will have a really BAD year this year ;-)
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Re: Annual Bonuses

Unread postby lionel2013 » Mon Dec 11, 2017 7:43 pm

Snowblower wrote:Understood, if she asks for it for next year and every year past she will get it. How was the 20% calculated? It seems like most states would have a baked in calculation for this that. I think my plan is that I am not going to agree to make assumed bonuses and it will be any part of the CS/SS calculation but instead will come re-actively by x% such as you said is happening. Honestly I am not going to be able to afford giving her anything I am not earning a portion of myself as is.


As part of your total compensation, if it is ordered as CS you cannot fight it, you can only insist (fight) it is paid by you to her, after the fact, as I described previously. In my case the 20% of net was calculated as I explained (net = gross minus taxes and other mandatory deductions, such as medical and dental insurance (not 401k contributions) - pretty simple). That's the only way to do it - no payroll department or no payroll company is going to go to the trouble of doing this calculation for you and pay part of your bonus directly to her as you fear they would. And yes, the divorce statute in any state has a "baked in" formula to calculate the net income for CS purposes. The one for IL is online, look up the one for your state on the internet, and if you can't find it ask your lawyer (or before that ask other board members from your state, here).

If the OC attempts to take part of it as SS you absolutely can and should fight it.

What are you looking at, $ amounts, in terms of CS and SS?
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Re: Annual Bonuses

Unread postby massdaddio » Mon Dec 11, 2017 7:54 pm

My CS was calculated using my fixed weekly salary. I also paid my ex the same percentage of my net bonus. The percentage decreased as kids emancipated. In Mass, CS is something like 27% for 3 kids, 25% for 2 kids, 22% for 1 kid. This is the only fair way to handle it, especially if the company's performance affects your bonus so you have no control over it.
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Re: Annual Bonuses

Unread postby hoosier_dad » Mon Dec 11, 2017 10:23 pm

I was in the same situation and my CS was set a little higher due to a bigger bonus that threw the income average off. IMO it's a long shot to convince a judge in IN that your bonuses are so variable that a set percentage is warranted. They tend to take the average over a couple years and bake it into the CS amount.
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