Posted by Nydia Streets of Streets Law in Florida Florida Family Law Procedure

When a parent owns a business and therefore has fluctuating income, how is this taken into account in calculating child support in Florida? Since net income is required in this calculation, consideration must be given to business expenses incurred. This was an issue in the case Brown v. Norwood, 5D21-385 (Fla. 5th DCA August 5, 2022).

The parties were divorced, and as part of their case, the court considered child support. The former husband was imputed to his full business income of $13,564.07 per month which was appealed on the basis that the trial court did not take into account the former husband’s business expenses. The appellate court sided with the former husband on appeal and remanded to the trial court to correct the errors in the calculation. The trial court re-did the calculation and ultimately found the former husband earned about $5,900 net income. The former husband appealed, arguing the trial court incorrectly calculated the amount again.

The appellate court agreed with the former husband on this second appeal again. The court held “First, for the 2014 income calculation, it appears the court used the 2015 tax return business expenses, i.e., repairs and maintenance plus other expenses, rather than the figures listed in the 2014 tax returns. These figures should have been $35,050 plus $15,340, for a total of $50,390. Thus, the taxable income total would have been $146,119 ($196,509 - $50,390), rather than $149,939, as the court found. The calculations for 2016 also contain mathematical errors. First, the court again used the figures from the 2015 tax return for the repairs/maintenance and other expenses ($28,785 and $17,785) rather than the figures for these items contained in the 2016 tax returns ($23,708 and $17,192). Next, the court made a subtraction error in subtracting $16,838 from $83,367, which should have been $66,529 rather than $80,610 as the court calculated. Lastly, for all three years, it appears that the court deducted social security, Medicare, union dues, and child support payments from the net taxable income after applying the tax rate rather than deducting the amounts from gross income to determine taxable income. This was error.”

Errors can occur in your Florida family law case. This is why it may be important to hire a family law attorney to assist you. Schedule your consultation to go over your case.