Posted by Nydia Streets of Streets Law in Florida Divorce

Imputing income to a party in a Florida divorce case requires specific findings to be made. Without these findings, a final judgment of divorce may be susceptible to reversal on appeal. This was an issue in the case Athea v. Athea, 3D22-519 (Fla. 3d DCA May 29, 2024).

In this divorce case, two issues were discussed on appeal - the valuation of the former husband’s business and imputation of income to the former wife. The trial court received testimony from a business valuation expert who determined that a large portion of the value of the former husband’s business was attributable to the former husband’s goodwill. The appellate court agreed, finding “In arriving at its valuation, the trial court relied on the testimony of the Former Husband’s business valuation expert, who found that based upon the Former Husband’s unique role and contributions to the business and the five-year non-compete covenant he signed, a significant amount of personal goodwill existed. As the record before us unquestionably includes this testimony, which the trial court found to be credible and reliable, we are compelled to affirm.”

Turning to the imputation of income to the former wife of $40,000 annually for alimony, the appellate court reversed, holding “We agree as the record lacks competent substantial evidence that the Former Wife had the ability to earn $40,000 a year in the relevant community. It is well-established that ‘any calculation as to amount of imputed income must consider evidence of the ‘prevailing earnings level in the community.’ [internal citations omitted]. Former Husband’s expert CPA testified that she is not a vocational expert, she did not have information on the availability of specific jobs in the area for which the Former Wife qualifies, she did not have any analysis of the current local job market and she did not have information on prevailing wages in the community. Because courts require ‘particularized findings regarding work history, occupational qualifications, and the current job market in the community to support the imputation of income’ and there are no such findings in our record, we find the trial court’s imputation of the Former Wife’s income in this case is not supported by competent substantial evidence.”

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