Often times if a court is trying to grant a child support award, but one of the parents is voluntarily unemployed or underemployed, the court will impute income to best reflect the party’s earning potential in his or her profession. As a practicing family law attorney for over twenty years in the field, I find that several of my clients want to know what standards will be utilized when making such a calculation. Sometimes the court will impute income based on the average earnings for the parent’s current or former occupation as reported by the New Jersey Department of Labor. However, the recent case of Santiago v. Concepcion illustrates an instance where a NJ family court believed the NJ Department of Labor statistic was too high and used its discretion to impute income instead. Let’s take a closer look.

In the case, the parties never married, but had a child together in 2009. Mr. Concepcion was self-employed as an attorney since the birth of the child, while his girlfriend, Ms. Santiago, worked part time at a local bakery. In January 2011, an initial child support order was entered. At that time, the court imputed minimum wage income of $290 per week to Concepcion because Santiago was receiving Temporary Assistance for Needy Families, better known as TANF.

Three moths later Santiago filed a motion to increase child support; however, the court denied the motion because she was still receiving TANF payments. In October 2011 Santiago filed another motion with the court to increase child support. However, this time she had obtained part-time employment and was no longer receiving TANF payments. The judge imputed Concepcion’s annual salary of $30,000 and increased his support obligations to $105 per week. He appealed.

On appeal, Concepcion argued that the trial judge should not have imputed his income at $30,000 because his previous year’s income tax return showed an annual income of $15,000. However, the Appellate Division disagreed and affirmed the findings of the lower court. The court first stated that a party cannot deliberately stay unemployed or underemployed in order to get around paying a higher amount of child support. It held that if a trial court believed that a party was purposely underemployed, it would be in its discretion to impute a higher income to the individual.

Additionally, the court stated that current earnings were not the only earnings it could look at when trying to determine a party’s obligation for support. Instead, the court held that a party’s potential to earn more is a significant factor to consider when determining his or her ability to pay support. The court stated that if it found that a party was voluntarily underemployed, it could impute income based on the average earnings for that party’s occupation as reported by the New Jersey Department of Labor.

Therefore, the Appellate Division agreed with the trial court that Concepcion was voluntarily underemployed compared to other attorneys in the state. The court held that the child needed to have basics such as food, shelter and clothing and if his father could only earn minimum wage as an attorney, he would have to look for additional employment to supplement his income. However, the court did note that it was not going to impute Concepcion’s income of $50,000 based upon the average earnings for a lawyer as reported by the New Jersey Department of Labor like Santiago requested.

Ultimately, the court used its discretion to determine that as an attorney, Concepcion should be able to earn at least $30,000 per year. For more questions on imputing income, please do not hesitate to contact my law firm today.