What is Imputed Income in Divorce in New Jersey?

In child support and alimony determinations during divorce, the court will look at the incomes of both spouses to decide on payments. But what if one spouse is not working? Or, what if one spouse is not working up to their capacity or what they used to do? Then how will child support be determined? In divorce cases, there is a concept called “imputation of income.” When a spouse in a divorce is voluntarily not working or is [intentionally or unintentionally] underemployed, their income may be imputed (credited) by the court for purposes of calculating child support and/or alimony amounts. The judge will look at several factors to determine how much the person could be earning. Once that number is arrived at, the calculations will be made as if the person is earning that amount of money, even though they are not. Either or both spouses in a divorce may have their income imputed if the court believes the circumstances warrant it. Situations in which it may be warranted include when someone voluntarily quits their job, is fired for misconduct, voluntarily takes early retirement, goes from full-time to part-time work, or intentionally works well below their full earning potential. This is often the case with self-employed business owners too. Even if job loss was involuntary, if the court believes a person is not looking hard enough to find adequate employment, they may impute income.

A Skilled Divorce Attorney Can Help with Your Imputation of Income

Having income imputed can put you in dire financial straits if you have lost your job or have been searching but are unable to find employment at your expected earning capacity. And it can be difficult to stop income from being imputed if the court believes you are underemployed or not seriously seeking adequate employment and you are not able to prove otherwise.  Or, this concept could be your saving grace to make the child support obligations more fair. If imputation of income is a possibility for your situation for you or your spouse, don’t want to wait to get guidance from an experienced New Jersey divorce attorney. An attorney can also represent your interests if you are seeking to have your unemployed or underemployed spouse’s income imputed for the purpose of child support or alimony.

How Is the Amount of Imputed Income Decided?

To arrive at a person’s imputed income, the court will consider several factors that, depending on each individual situation, can include such things as the following:
  • Educational background
  • Skill set
  • Work history and experience
  • Current earning ability
  • Former income in their occupation before job loss
  • Average salary in the person’s field according to New Jersey data from the U.S. Bureau of Labor Statistics
  • Availability of applicable jobs in the geographic area
  • The state’s current minimum wage.
Just because a person could be earning more based on their background, this doesn’t automatically mean the judge will impute their income. But if the court believes the person is intentionally earning much less money than they could, if they lost a job a long time ago and are not looking for work, or if they voluntarily quit their job in order to avoid paying support, they could well find their income imputed. Both parents have an obligation to support their children, and if a judge thinks a parent is trying to shirk child support obligations or pay less than is fair in support based on the circumstances, they will not look kindly on that person.

Evidence to Avoid or Reduce Imputed Income

If you are in a situation where your income may be imputed, you should gather any proof you have of how you lost your job and/or what strong steps you have taken to find work that pays you a salary in line with your experience, education, skills, etc. Documentation to gather may include:
  • A notice of layoff or termination from your employer to highlight that you did not leave your job voluntarily.
  • Job advertisements at your expected work capacity to which you responded.
  • Your resume and cover letters you prepared in your job search.
  • Emails or other written materials showing any interviews you had.
  • Job rejection letters/notifications you received.
Your New Jersey child support lawyer will use this information as evidence to build a case on your behalf to potentially reduce the amount of income imputed or temporarily reduce what you must pay until you are able to find adequate work. On the other hand, if you are the one wishing to have the other spouse’s income imputed, you will need to produce evidence that shows they should be earning significantly more, or that they are able to find employment at their level but aren’t looking for it hard enough or even at all. These documents could include their wage and benefit stubs from previous jobs, information about their educational background, and tax returns.

Situations in Which the Court May Decide Not to Impute Income

Of course, there can sometimes be very real situations in which a person cannot work and the judge does not impute income. This may be the case with a serious physical or mental disability that makes working impossible. If a person claims a disability to avoid having income imputed, they may need to provide documented medical proof of said disability. If it is truly the case that they are unable to work at any level, the judge may not impute income. However, every case of disability and every person’s circumstances are different. A skilled attorney can answer your questions and address your concerns about imputation of income if disability is a factor.

Speak to an Experienced Hackensack Divorce Attorney When You Need Help

Whether you are seeking to have your spouse’s income imputed in divorce to get fair child support or alimony payments, or your soon-to-be former spouse is trying to have your income imputed, the knowledgeable attorneys at Men’s & Fathers’ Rights Divorce Lawyers by Schultz & Associates, LLC, will advocate for your interests before the court. Once we understand all of the unique details for your particular situation, we will build a case designed to protect your interests and one that is in the best interests of your children. Call our Bergen County, New Jersey, law firm to arrange a case evaluation at (201) 880-9770.

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