How many years’ salary should be averaged for child support in TN?

How many years of salary should be averaged to determine parent’s salary for child support purposes in Tennessee?

DAVID L. ADAMS v. NANCY W. ADAMS – Tennessee Child Support Case Summary

How many years of salary should be averaged to determine parent's salary for child support purposes in Tennessee?

How many years of salary should be averaged to determine parent’s salary for child support purposes in Tennessee?

In 1994, Daniel L. Adams (“Father”) sued his wife, Nancy W. Adams (“Mother”) of 12 years for divorce.   Their two children were aged ten and eight years old at the time the divorce request was filed.  The Mother has a high school diploma and at the time of the divorce worked as a teacher’s aide in the local middle school and as the music director for a church.  In 1994, she earned $7,950.  The Father is a lawyer and a sole practitioner since 1988.  From 1988 through 1992, the Father’s income varied between $30,000 to $97,000.  In 1994, his income was $134,300.The couple was divorced on September 25, 1995.  The trial court found that the Father’s  gross monthly income was $4,600 and using this figure, awarded child support in the amount of $ 1,060 per month for both children.   In addition, the trial court ordered the Father to provide medical insurance for the children and to pay any medical costs not covered by insurance.The Mother filed an appeal asking that the child support be increased.  The Mother did not argue that there was a change in circumstances but rather that the trial court made a mistake in setting support at $1,060 based on a calculation of the Father’s gross income at $4,600.   The appellate court found that the trial judge used the income figures for 1992 ($55,824) and 1993 ($52,008) to determine the Father’s income.    The appellate court, however, held that the trial court could have come to a more realistic income figure by averaging the Father’s income over the last five years, including 1995 (no figures are provided for 1995).

The appellate court sent the issue of child support back to the trial court, and asked the trial court to determine the amount of child support using an average of the Father’s net income over the past five years, including 1995. The court was asked to calculate the Father’s  net income according to Rule 1240-2-4-.03 of the Child Support Guidelines, entitled “The Income Shares Model.”

The Tennessee Child Support Guidelines, using the Income Shares Model,  take into account both parents’ income and the needs of the child or children.  Each child’s basic needs – food, housing, transportation, clothing and entertainment – are calculated on a monthly basis.  Gross income is then calculated for each parent.  Gross income is based on many sources of income, including, but not limited to, wages, salaries, bonuses, commissions, overtime, severance payments, interest, dividends, net capital gains, worker’s compensation, disability, prizes and lotteries, just to name a few.  Once the parent’s gross income is determined, deductions may be made based on various types of “credits,” such as self-employment tax, for self-employed parents.  In general, the amount of child support needed is divided by the AGI of each parent, determining the share each parent has to pay monthly.

No. 01-A-01-9606-CH-00281, Court of Appeals of Tennessee, Middle Section, at Nashville, January 8, 1997.

See original opinion for exact language.  Legal citations omitted.

For more information, see Averaging Income in Tennessee Child Support Law and Tennessee Child Support Answers to FAQ’s.  For legal updates, news, analysis, and commentary, visit our Tennessee Family Law Blog and its Child Support category.  A Memphis child support attorney from the Miles Mason Family Law Group can help you with Tennessee child support issues including setting or modifying child support. To schedule your confidential consultation about Tennessee child support, call us today at (901) 683-1850.


In TN Child Support Retained Earnings Must Be Manipulated to Be Income

Tennessee law case summary on income determination. Absent a showing that the retained earnings were excessive or that an obligor was actually manipulating his or her income, the retained earnings of an S corporation should not be imputed as income to the sole or majority shareholder in calculating a child support obligation. Tennessee child support law from the Tennessee Court of Appeals.

Taylor v. Fezell – Tennessee child support case summary on retained earnings as income.

Douglas Fezell and Angela Daniels were married in 1986, and had two children. The couple divorced in 1999.  In their Marital Dissolution Agreement (MDA), Mrs. Fezell was designated as the primary residential custodian of the two minor children. The MDA also provided that Mr. Fezell was to have visitation time greater than the standard amount contemplated by the Tennessee Child Support Guidelines (guidelines).  In consideration of Mr. Fezell’s additional visitation and the establishment of a trust fund for the children, the parties agreed that Mr. Fezell would pay child support in the amount of $1,000 per month until July 31, 1999; after that it would increase to $1,300.  The MDA also provided a method to calculate Mr. Fezell’s contribution to the trust.

Mr. Fezell’s child support obligation was based, in part, on his income from Professional Vending Services (PVS).  At the time of the divorce, Mr. and Mrs. Fezell were the sole shareholders of the company, each owning a 50% interest.  The Fezells agreed in the MDA that Mr. Fezell would continue to run PVS as the sole shareholder and president, and that he would pay his ex-wife $310,000 in exchange for her half of the company.  Mr. Fezell completed the purchase of this stock and was the sole shareholder of the corporation at the time of the appeal to the Tennessee Supreme Court. Continue reading