Imputed Income: No you can't quit your job to reduce your child support obligation.

Each week the Missouri Bar Association publishes case summaries of Missouri Supreme Court and Appeals Court Cases. In this week’s edition there were two cases regarding imputed income. Imputed income is a tool courts use when one parent purposely reduces their income in order to reduce the amount owed to their ex through child support or spousal support.

Our first case is Jennifer McKenna vs. Steven McKenna out of Jackson County. The Dad in this case appears to be a pretty big dbag. The couple were originally divorced in 2015 and now Mom has filed a motion to modify seeking sole custody and limiting Dad’s visitation to supervised parenting time. To support her motions, Mother alleged in a verified petition that Father harmed the children’s well-being by: disparaging her to the children, unilaterally removing the children from therapy, threatening to remove the children from their parochial school, threatening to remove the children from various activities, drinking to the point of intoxication while parenting the children, and verbally abusing the children….She also says the kids fear Dad when he is boozing. Later on in the case it is revealed Dad has narcissistic personality disorder.

What happened next is what this case is about. This dude was making bank, 280K per year and he voluntarily left his job as a managing engineer at a large engineering and construction firm. When he quit his job, he had no plans for another one. He claimed he would only take a job that did not require travel, but the evidence showed he was only allowed supervised visitation with his children for a small amount of time. Added to that, it sounds like his kids didn’t even like him because, among other things, he was always wasted.

Dad estimated that with his education and expertise, he could find a job that didn’t require travel and would earn approximately 80K. He wanted the court to base his child support amount on 80K, not the 280K he used to make, and of course, Mom wanted the child support based on the 280K figure. During the trial on the motion to modify, nearly two years after Father had left his job, Father admitted he had not submitted a single job application and had declined to proceed with multiple job offers from recruiters.

The trial Court agreed with Mom and imputed Dad’s income at 273K and calculated the child support amount to be $3175/month (which seems low, Mom must have a good job also).  In a previous case, Cross v. Cross, 318 S.W.3d 187, 192 (210), the Court described imputed income. “The theory behind imputing income to a spouse/parent is directed toward preventing a spouse from escaping responsibilities to the family by deliberately or voluntarily reducing his or her income. Imputation of income is proper where a parent has voluntarily reduced his or her income without justification. The most common scenario for voluntary reduction of income without justification is where a parent deliberately quits work to reduce his or her child support.”

Dad appealed the trial court’s decision to impute his income at 280K, but the Missouri Supreme Court sided with Mom and the trial court’s decision. When determining whether to include imputed income and, if so, the amount to include in a parent’s “gross income,” a court or administrative agency shall consider all relevant factors, including:

(1) The parent’s probable earnings based on the parent’s work history during the three years, or such time period as may be appropriate, immediately before the beginning of the proceeding and during any other relevant time periods; and

(2) The parent’s assets, residence, age, and health; and

 (3) The parent’s occupational qualifications, employment potential, educational attainments, and record of seeking work; and

 (4) The parent’s criminal record or other employment barriers; and

(5) The available work or employment opportunities in the community and the prevailing earnings level in the local community; and

 (6) Whether the parent is custodian of a child whose condition or circumstances make it appropriate that the parent not be required to seek employment outside the home; and

(7) Other relevant background factors in the case

The Supreme Court concluded that Father intentionally quit his job to attempt to ensure that Mother would receive less child support. Sorry Dad but you need to man up.

Our second case of the day comes from the STL and the Circuit Court of St. Louis County. This Dad isn’t as bad as Dad #1. The divorcing couple had two kids, one with special needs. While the parties were separated but before they had filed for divorce, Dad quit his job at McDonalds after 28 years with the company, withdrew 200K from his 401K and started a restaurant with a few friends. He was making about 80K at Mickey D’s and as you can imagine wasn’t making near as much money in a restaurant start up. During the divorce the trial court imputed his income at the 80K level for the purposes of child support and maintenance. Dad appealed this decision. By the way, the Court also made Dad pay Mom ½ of the 200K he took out of his retirement to start the restaurant.

Dad argues that because he quit McDonalds before the filing of their divorce, his income for the purpose of calculating child support should be his current income as a restaurant owner, which is much lower (it’s also much easier to manipulate your income when you own a business). Dad’s major complaint with McDonalds and the reason he claims he left was because of the long hours. Yet the evidence shows that Dad still works long hours as a restaurant owner. Based on the evidence, the Court opined that the trial court was within its discretion to consider Dad’s past, present and anticipated earning capacity to determine his ability to pay child support.

As these cases illustrate, judges are not going to allow deadbeat Dads to voluntarily quit their job to reduce their child support obligation. Even if your ex is terrible, think long and hard before you do something like this. Your children need your financial support and in the end, you are only hurting them by trying to avoid child support. Courts will not hesitate to impute your income.

The Men's Center for Domestic Resolution is located in Pleasant Hill in Cass County, Missouri. Call us today to discuss your family law matter.