Imputing Income for Child Support in Tennessee

Whether they're married to one another or not, both parents must financially support their minor children. When deciding child support, courts usually order the noncustodial parent (parent with less custodial time) to pay child support to the custodial parent (the parent will all or more custodial time).

Courts use parents' income to calculate child support. Since higher income generally results in higher child support, some noncustodial parents purposely lower their income to lower their child support obligation. Most states have laws to protect against this type of behavior. Under these laws, courts can use "imputed income," an amount the court believes a parent should be able to earn, rather than a parent's actual income, when calculating child support.

This article will explain how imputed income works in Tennessee child support cases. If you have additional questions about imputed income in Tennessee after reading this article, speak with a local family law attorney.

Overview of Child Support in Tennessee

Tennessee courts follow the state Child Support Guidelines to calculate child support. The court combines both parent's adjusted gross income and uses a percentage of that total, called the "basic child support obligation," as the amount the parents should contribute together to financially support the children. The court then orders the noncustodial parent to pay a share of the basic child support obligation in proportion with how much that parent earns compared to the custodial parent. Tennessee courts can adjust the final child support amount using the following factors:

• medical insurance costs for the children
• work-related childcare expenses
• special needs of the children
• the amount of time each parent has the children
• deductions from each parent's income for self-employment taxes, child support for other children, or social security benefits collected on behalf of a child, and
• any other reasons that are in the best interests of the children.

To read more about the specifics of child support calculation, see Child Support in Tennessee. Tennessee courts can modify child support up or down if a parent has a significant change in income. However, courts won't allow a noncustodial parent to decrease child support if he or she is willfully unemployed or underemployed.

What is Imputed Income?

When parents refuse to show proof of their income or are voluntarily unemployed or underemployed, courts will still order those parents to pay a fair child support amount. In these cases, the court comes up with an amount of income to use in the child support calculations, called imputed income. The court will try to determine a parent's earning capacity and use that figure to calculate child support. In Tennessee, there is a minimum amount of income courts impute for all parents.

The Important Difference Between Voluntary and Involuntary Unemployment

Tennessee courts won't punish a parent who legitimately cannot earn more income or find a job; courts impute income when parents are voluntarily unemployed or underemployed. If the court finds that a parent has been laid off and is diligently seeking new employment, the court will not impute income to that parent for child support purposes. Also, if a parent can't work because of legitimate reasons, like a disability or need to take care of a disabled child, the court won't impute income.

If a parent is voluntarily unemployed or underemployed, the court will decide whether that occupational choice is reasonable or not, using the following factors:

• the parent's employment history
• the parent's ability to work
• the parent's education or job training
• if a parent is seeking additional education or job training, whether that decision will benefit the children, and
• whether the parent is a full time caretaker of a child or other relative.

If a parent's unemployment or underemployment is reasonable, the court won't impute income to that parent. When a parent is unemployed or underemployed without good reason, the court will impute income to that parent for child support purposes. It doesn't matter whether the parent's unemployment or underemployment was specifically for the purpose of reducing child support; the court can impute income in either case. For example, the court can still impute income for a parent who is incarcerated or simply chooses to not work for personal reasons.

How Does Tennessee Calculate Imputed Income?

Tennessee courts impute income in two situations: when a parent refuses to produce reliable proof of his or her income, and when a parent is voluntarily unemployed or underemployed.

A parent can't escape paying child support just by refusing to show proof of income. When the court doesn't have reliable evidence of a parent's income, the court will impute income of no less than $37,589 for male parents and $29,300 for female parents. The court can also consider other evidence for a parent refusing to show evidence of income, such as the parent's previous income or employment. A parent can ask the court to recalculate child support by producing reliable evidence of income at a later date.

When a parent produces proof of income, but that income doesn't make sense when compared to a parent's lifestyle, the court may also impute income. For example, if a parent claims to earn $20,000 per year, but drives a luxury car and lives in a mansion, the court can impute an income amount that matches that parent's lifestyle.

Tennessee courts can also impute income when a parent is voluntarily unemployed or underemployed. Courts look at all of the following factors when deciding the amount of income to impute:

• the parent's past income
• the parent's past jobs
• the parent's education
• assets owned by the parent, whether they produce income or not, and
• employment opportunities in the area where the parent lives.

The court won't impute income of more than 10% for each year since the last time child support was calculated. For example, if a parent earned $50,000 two years ago, the court could determine that parent's earning ability was $55,000 a year later ($50,000 + $5,000), and $60,500 today ($55,000 + $5,500).

Tennessee courts use imputed income in the same way that actual income is used in child support calculations.

Resources

If you have additional questions about imputed income in Tennessee, you should contact a Tennessee family law attorney.

To read the full text of the law on determining child support in Tennessee, read the Tennessee Rules and Regulations 1240-02-04-.04