Posted by Nydia Streets of Streets Law in Florida Divorce
What income is considered in deciding how much to award in Florida alimony or child support? Florida Statute Chp. 61.30 lists payments that are considered income for purposes of calculating support. Included in that list are in-kind payments from an employer which reduce a party’s living expenses. This was a topic in the case Ortega v. Wood, 1D20-1534 (Fla. 1st DCA April 9, 2021).
The former husband was an optician who owned an optical business. Among the benefits provided by the business to him were an apartment where he lived at no cost. Company funds were also used to pay for “massages, dentist appointments, physician appointments, and lab tests for [the former husband], prescriptions for [the former husband] and his children, a lawn mower that was used for and kept at his private residence, cord blood storage bills for the children, and products from GNC stores.” Despite this, the trial court refused to impute these benefits as income to the former husband, reasoning that because the apartment was a corporate asset, it was not subject to this scrutiny, and because the apartment was not marketable to third parties, there was no rental value to consider. The court also determined that because the same reimbursements were offered to all employees, the former husband’s in-kind reimbursements were legitimate business expenses and not income to be imputed to him. This resulted in a child support and alimony award which were well below what the former husband could pay. The former wife appealed.
The appellate court found it was error for the trial court to refuse to impute income to the former husband. The court held “The relevant inquiry is whether the benefit is regular and expected and whether the benefit reduces living expenses. It was error not to include the former husband’s business income or his reimbursed and in kind payments that reduced his living expenses. However, where reimbursements are for business expenses incurred by a party instead of living expenses, they are not to be imputed as income. Medical insurance, term life insurance, the use of a company car, and contributions to an IRA account paid by an employer have been found to be income. However, where gifts of food, clothing, the use of a home, money for bills and the payment of some of the children’s tuition are periodic and not regularly provided, it is error to impute their value as income.” (internal citations omitted).
The court continued: “The source of the benefit, whether from [the former husband’s] mother or from the business, is immaterial. Nor does it matter whether he owned the business or was merely an employee. The trial court made several statements that illustrate its confusion. According to the trial court, in order to be considered imputed income [the former wife] would have to demonstrate that no other employees were availing themself of the benefit. To the contrary, the fact that [the former husband] testified that all employees can expect to have these personal expenses reimbursed through the company supports the conclusion these benefits were regular and expected.”
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