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How is Maintenance and Child Support Calculated in Variable-income Families?

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By Joshua E. Stern, Divorce and Family Law Attorney

In any marriage, financial earnings are almost never equal. And in divorce, the higher-earning spouse may worry about paying too much support to their spouse, while the lower-earning spouse may have concerns about providing for their child. When you work with our team at Stern Perkoski Mendez, our goal is to reach an agreement that works well for everyone: you, your former spouse and your children.

What if I’m the higher earning spouse but have a variable income?

If you’re the higher-earning spouse and had an exceptionally profitable year in business or were working at an unsustainable pace and thus expect your income to drop, it makes sense to be concerned about your financial future after divorce. Clients come to us with these worries all the time. Luckily, there are roadmaps in place to ensure you’re not paying spousal and child support based on a one-time or unsustainably high income.

There are two main situations in which our clients anticipate their income changing substantially. First, they’re in an industry where their income isn’t constant or guaranteed each year, such as real estate. Second, they worked at an unsustainable pace for a year or two in the finance industry, for example, and can’t continue doing so long-term.

I had an exceptionally good year—but I know that won’t be the case with a looming recession. How will maintenance and child support be calculated?

If you’re in one of these situations and beginning the divorce process, you can request that support be calculated based on a moving average. Instead of considering your income for the past year, the court will review your average earnings over the past 3-5 years. Ideally, this will establish a more normal and sustainable maintenance amount.

I know I’m not going to earn to my full potential this year—can support payments be adjusted?

Another way the court handles variable and unpredictable income is through reconciliation, which allows you to pay support based on an estimated income and then reevaluate every year or two. For example, if you’ve had million-dollar years in the past but expect the upcoming year to be far lower, you may be asked to pay support based on a $500,000 income. Then, the court will check in next year to see what your income actually was and will adjust your support accordingly. This allows you to avoid overcommitting based on a past, abnormally high income.

What do I do if I need to change jobs, but I’m worried about support payments?

If you’re already divorced and paying child and spousal support, it’s advisable to avoid a significant change in income without court authority. If you need to switch jobs due to an unsustainable environment and lifestyle, it’s best to file this change with the court. By notifying the court, you can establish a basis so that you aren’t accused of attempting to evade support.

If you’re earning a high income, there needs to be a legitimate reason why it’s suddenly dropping. Many times, our clients have been working 70 or 80 hour weeks in a demanding industry and can’t continue to do so. They want to coach Little League, spend time with their kids and have a more manageable work-life balance.

While this is certainly reasonable and permissible, you’ll likely need to explain it to the court and have your support adjusted accordingly. Because you and your spouse are expected to maintain a standard of living after divorce that is comparable to what you had prior to divorce, you can’t make major changes without consulting the court.

Contact Our Divorce and Family Law Firm in Evanston, Chicago, Lake Forest and Oakbrook Terrace

If you’re working at an unsustainable job and need to make a lifestyle change but are worried about how it will affect your child support and spousal support payments, contact our team. We can support you in reaching a solution that provides a comfortable standard of living for you, your former spouse—and most importantly, your children.

Give us a call at (847) 868-9584 or request a free consultation online. We will happily meet with you at our offices on the North Shore in downtown Evanston and Lake Forest, our Chicago location in the Loop, or our DuPage County office in Oakbrook Terrace.

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For a free consultation, call Stern Perkoski Mendez at (847) 868-9584 or contact us.