Imputing Income for Child Support in Minnesota

A look at the process of imputing income in Minnesota and how it impacts child support.

When two adults marry or are romantically involved, they're free to end the relationship at any time and move on with their lives. What they're not free to do is stop providing financial help ("child support") to their children. Both parents have to support their children, but usually one ("the paying parent") will wind up paying more than the other ("the receiving parent").

It's a common misunderstanding for paying parents to think that child support is a financial benefit to the receiving parent. But child support belongs to the children, and the receiving parent is only the legal conduit between the children and the money. Child support can only be spent on the children's needs. So when a paying parent tries to get even with a receiving parent by withholding child support, the only ones who are harmed are the children.

Paying parents can't avoid paying child support by refusing to work or by intentionally working less than they normally would. If they do, the court may "impute income" to them, which means that the court will issue a child support order that assumes the paying parent is working at ordinary or potential earning levels.

This article will explain when and how courts impute income for child support purposes in Minnesota. If you still have questions after reading this article, you should contact an experienced family law attorney for help.

What Do I Need to Know About a Minnesota Child Support Order?

Parents have the opportunity to decide on all the financial terms of their breakup, including child support. This is the easiest way to set up child support, because parents retain control over the decision. However, if couples can't agree about child support, the matter will be decided by a judge.

Minnesota uses a child support calculator to determine the amount that each parent is responsible for paying. It's assumed that both parents have to work to support their children. The calculator adds up each parent's income for child support (also known as "PICS"). A parent's PICS  is  gross income minus deductions, if any, for non-joint children (meaning, deductions for child support and expenses for any children who were born as the product of a different relationship). Each parent's PICS  is entered  into the calculator, which also takes other variables, like alimony and insurance expenses, into account. For more information about how child support is calculated in Minnesota, please see  Child Support in Minnesota (Nolo).

Child support orders are meant to be flexible. Either parent can come back to court and ask for a modification (meaning, a change) of the child support order if financial circumstances have changed substantially, and the existing order is unreasonable or unfair.

The paying parent can ask the judge to reduce the child support order or the receiving parent can ask the judge to increase it. The judge may grant the request if:

  • the  cost of living has changed
  • one  of the parents has gone on public assistance
  • there  has been an increase or a decrease in either parent's gross income or necessary expenses
  • a  child's expenses and needs have increased, or
  • there  has been an increase in medical, child care or occupational expenses.

What if the Paying Parent Stops Working or Claims to Have no Income?

From time to time, paying parents fail to live up to their financial responsibility to their children. This generally happens in one of four ways:

  • The paying parent  voluntarily  becomes unemployed. For example, a paying parent might quit a job and stay home, or sabotage work performance until an employer is forced to fire the parent.
  • The paying parent  voluntarily  becomes "underemployed." Underemployment means that the paying parent isn't working the usual amount of hours or at the regular pay rate, perhaps because the parent asked for fewer hours or accepted a position with less responsibility.
  • The paying parent is employed on less than a full-time basis.
  • There's no direct evidence that the paying parent is receiving any income from employment. This is a common scenario when parents work for cash.

When any of the above four situations exist, Minnesota judges must compute "potential income" (meaning, the amount that the court thinks the paying parent  could have  earned) when they calculate child support. By including potential income, the courts ensure that the paying parent's ability to contribute financially to the child's life is reflected in the final order. Potential income can be calculated in three different ways:

  • by  estimating the parent's probable earnings based on the parent's employment history
  • by  estimating the parent's probable earnings based on the parent's unemployment benefits, or
  • by  calculating what the parent would earn if employed full-time and receiving 150% of the current minimum wage.

Additionally, a paying parent may become  involuntarily  unemployed or  involuntarily  underemployed. For example, a paying parent's employer might issue company-wide layoffs or reduce the paying parent's hourly wages or schedule. In these cases, the unemployment or underemployment is not the paying parent's fault, so the court will not calculate potential income. If this happens to you, make sure you keep records of what happened at your previous employer and of your job search efforts, so that you can prove to the court that you're trying hard to work and this situation isn't your fault.

What is Imputed Income?

When the court calculates potential income and includes it in a child support order, that action is "imputing" income  tothe paying parent. This means that the judge believes, based on the available evidence, that the parent is capable of paying child support and should have had earned wages or a salary in the amount of the potential income. Imputed income is assigned to a parent who doesn't actually have the money, but who the court believes should be responsible anyway.

In Minnesota child support proceedings, both parents are required to provide the court with a financial affidavit (meaning, a sworn statement signed in front of a notary public) which outlines all income, expenses, assets, and liabilities. The parents are also under a continuing legal obligation to give financial documents like pay stubs and tax returns to the court and to each other.  No matter what, you must complete the affidavit and provide all required documents. The consequences of failing to comply can be very serious. If a parent fails to furnish the affidavit or supplemental documents, the law  requires  the judge to impute income to that parent.

Resources

Minnesota Judicial Branch Self Help Center, Child Support help

Minnesota Department of Human Services, Child Support Services

Minn. Stat. § 518A.26

Minn. Stat. § 518A.29

Minn. Stat. § 518A.32

Minn. Stat. § 518A.34

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