Tennessee Father’s Income for Child Support Can Include Stock Sales

Tennessee child support law in Tennessee divorce & family law from the Tennessee Court of Appeals.

Alexander v. Alexander – Calculating Gross Income for Tennessee Child Support

This decision breaks down into clear categories a number of sources of income and expenses which may be considered for purposes of child support.

Donald James Alexander (the Father) and Carolyn Paxton Morrow (the Mother) were   married for 12.5 years and had two children, who were 11 and 10 at the time of the divorce decree in February 1995.   The Father was ordered to pay $2,194 per month in child support in 1995.   In 1997, the Mother filed for an increase in child support, claiming that there was a significant variance, according to the Tennessee Child Support Guidelines,  in the Father’s income to require an increase in child support.   According to Tennessee law, a modification may be made to the amount a non-custodial parent has to pay if there has been at least a 15% change in that individual’s gross income.

Father’s Bonuses Should Be Averaged in Tennessee Child Support Law

Tennessee child support law on income determination (bonuses and commissions) in Tennessee family law from the Tennessee Court of Appeals.

Burnett v. Burnett – Calculating Bonuses and Commissions for Tennessee Child Support Awards

The Father, David Mark Burnett, an account manager with Fedex, and the Mother, Analiza Palatones, were married in 1999.  The couple had three children.  In 2003, the Mother filed for divorce.  At the time of the first trial, the Mother, 36 years old, had a high school degree and worked part-time as a waitress and part-time with Northwest Airlines, escorting unaccompanied minors.  In these two jobs, over a two week period, the Mother earned approximately $200.  The Father was 45 years old at the time of the trial and had been working for Fedex for sixteen years.  His monthly net base salary was $4,829 plus quarterly bonuses, which changed significantly from year to year.  In 2005, Husband earned  a yearly salary plus bonuses totaling $120,213.38.   In 2006, the Father’s FedEx earnings statement through October 14, 2006 showed gross earnings of $111,812.80, consisting of base salary plus bonuses. The Father’s affidavit showed his bonuses for 2003, 2004, 2005, and 2006 were $7,389, $20,810, $36,810, and $43,402, respectively.

TN Father Sought Child Support Reduction Gets Increase $400 Per Month

Tennessee child support modification law in Tennessee family law from the Tennessee Court of Appeals.

Tennessee Father Who Sought Child Support Reduction Gets an Increase of about $400 Per Month Due to Large Cash Deposits into Father’s Bank Account Imputed as Income

Parris vs. Parris – Modifying Tennessee Child Support + Income Determination

The Father, Jerral D. Parris, was obligated by a 2003 decree of divorce to pay $1,250 per month in child support to the mother, Irina N. Parris, for the Parties’ two children. The decree included a “Permanent Parenting Plan.”

The Father filed a motion to request a downward modification of his child support obligation in 2005. A hearing was conducted in 2006, including testimony from six witnesses.

The Mother worked as a teacher’s assistant, earning gross wages of $715 per month, or, $8,266.56 per year. The Mother also supplemented her income by maintaining and renting six homes, taking in $100,004.52, less expenses of $16,354 in 2005. She also earned money helping prepare tax returns. The Mother provided her W2 and Form 1099 statements for 2005.

59 Yr Old TN Father Appeals Willful Underemployed + Private School Tuition

Tennessee child support modification law in Tennessee family law from the Tennessee Court of Appeals.

Kaplan v. Bugalla – Modify Tennessee Child Support + Private School Tuition

The parties in this case are Brendi Kaplan (“Mother”) and John A. Bugalla (“Father”). The parties were married for over 10 years and have 2 children.  At the time of divorce, Mother was an attorney making $87,000 per year and Father was an executive at Aon making between $279,000 and $350,000 per year. Father’s initial child support payment was set at $4,000 per month in May 2002. This payment did not include private school tuition as Mother planned on moving with children and enrolling them in public school. Mother’s plans to move did not work out and Mother sought an increase in child support to pay for the children’s private school education in September 2002.  In 2003, the trial court denied Mother’s request for private school tuition. Mother appealed the decision and was again denied the private school tuition. In 2005, Mother sought a grant of certiorari. The Supreme Court heard this case on October 5, 2005.  The Supreme Court reversed the decision of the trial court, denying Mother’s request for private school tuition, and remanded it back to the trial court.

To Modify Child Support in Tennessee, Court Must Follow Legal Process

Tennessee child support modification process in Tennessee family law from the Tennessee Court of Appeals.

Lana Walton Luster vs. Kenneth Walton – Process to Modify Child Support in Tennessee Law

In 1994, the Parties were divorced, using a “Marital Dissolution Agreement” that was incorporated into the decree of divorce.  The Father, Kenneth Walton, agreed to pay the Mother, Lana Walton Luster, the sum of $624.54/month for child support.

Beginning in 1996, a string of petitions was filed by the Parties, who primarily represented themselves, but, upon occasion, were represented by Counsel.  Court appearances were made until 1999.

Then, from 2006-2008, the Parties again filed various petitions against each other.  Chief among the allegations was the question of whether the Father’s child support obligation had been reduced to $411/month, either by a court order that was inadvertently not memorialized in writing, or by agreement of the Parties that should have been reduced to a written court order, or by virtue of the Father paying and the Mother accepting this amount for a period of time between 1997 and 2006.

Tenn. Trial Lawyer Father’s Child Support Income Based on Disability

Tennessee child support law in Tennessee family law from the Tennessee Court of Appeals.

Turner v. Turner – Child Support Income Determination for Disabled Trial Lawyer

Ginger and Robert Turner, Jr. were married in 1980.  Mr. Turner was a trial lawyer, and Ms. Turner was a college graduate who had worked for several Nashville companies.  After getting married, Ms. Turner worked in Mr. Turner’s law office until their first child was born in June 1985. Their second child was born in February 1988.

The court of appeals described the marriage as troubled from the beginning.  Mrs. Turner left Mr. Turner for three periods during the marriage.  Subsequently in April 1991, she and the children left home and moved into a domestic violence shelter.  One week later, she filed a complaint for separate maintenance and also sought and obtained a temporary restraining order to prevent Mr. Turner from harassing or threatening her or interfering with her custody of the children.  Mr. Turner was hospitalized and treated for severe depression and other problems. The parties attempted to reconcile after Mr. Turner returned to Nashville, but five weeks later, Ms. Turner and the children moved into a one bedroom apartment attached to her parents’ home.

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.

Tenn. Child Support on Business Owner’s Earnings Less Certain Expenses

Tennessee law case summary on income determination and deductions for income determination of a business owner under Tennessee divorce and family law from the Tennessee Court of Appeals.

Presson v. Presson – Tennessee Child Support Case Summary – forrestry services business

Michael and Joan Presson were married in September of 1974. They had one child.  Mr. Presson sued for divorce in 1991, and the Pressons entered into a Marital Dissolution Agreement (MDA) three days after the divorce complaint was filed.  The MDA set Mr. Presson’s monthly child support obligation at $700.  Mrs. Presson subsequently consulted two attorneys before retaining a third in an attempt to invalidate the MDA.  The parties entered into an Amended and Re-stated MDA in July 1991.  This second Agreement provided that Mr. Presson was to pay monthly child support of $800.

In June 1992, the Mrs. Presson filed a petition to set aside the final decree regarding the child support.  At an evidentiary hearing in the trial court.  Both parties presented expert testimony touching upon Mrs. Presson’s mental and emotional state during the period of negotiations leading up to the execution of the Amended and Restated MDA.  The trial court entered a nine page order on June 18, 1993, in which it denied the Mrs. Presson’s Petition to Set Aside Final Decree, but increased her child support entitlement to $1,000 per month plus $300 per month to be placed in an educational trust fund.

Self-employed Tenn. Father Held Earns $14,000 / Mo for Child Support

Tennessee law case summary on income determination for self-employed parents in Tennessee divorce and family law from the Tennessee Court of Appeals.

Norton v. Norton – Tennessee Child Support Case Summary – Income determination for self-employed child support obligors

Note: Although the Tennessee child support guidelines are significantly different today than at the time this case was issued, the discussion regarding income determination is a very helpful example of the types of issues that arise when dealing with self-employed business owners.

Lisa Norton appealed the trial court’s judgment increasing the child support obligation of  Max Norton from $400 per month to $1,200 per month; ordering Mr. Norton to contribute $300 per month to an educational trust fund for the Nortons’ minor child.  In considering Mrs. Norton’s petition to modify child support, the trial court found that Mr. Norton’s financial condition changed very little since 1988 when they agreed to a Marital Dissolution Agreement (MDA).  However, based primarily on Mr. Norton’s agreement to pay more child support, the trial court increased his monthly child support obligation to $1,200.  The Tennessee Court of Appeals vacated the trial court’s decision based on its conclusion that the trial court used the incorrect test for determining whether Mrs. Norton was entitled to the relief sought in her petition for modification.

TN Father Claimed Withdrawals From Capital Not Income Under Guidelines

Tennessee law case summary on income determination for self-employed obligor in Tennessee divorce and family law from the Tennessee Court of Appeals.

Koch v. Koch – Tennessee Child Support Case Summary – Father’s Claimed Depletion of Capital Account Held Income

Patsy Koch sued her husband Mark Koch for divorce and related relief.  Mr. Koch answered the complaint and filed a counter-claim for divorce and related relief.  The Kochs were married in September 1977 and had two minor children.  The marriage was stormy almost from the beginning—the Kochs were separated four times, including the last separation in March of 1990 that ended up in the divorce.  Mrs. Koch filed her complaint in March 1990, at which time she was seven months pregnant with their daughter.

Mr. Koch graduated from college in 1980 with a Bachelors Degree in Engineering Technology, but after graduation he purchased an interest in a small corporation with a $10,000 loan from his mother. Due to financial difficulties, the corporation ceased doing business in December of 1988; at that time Mr. Koch assumed some of the corporation’s liabilities and work in progress, and began doing business as a sole proprietorship under the name of Commercial Painting Company.