I just posted this on my law office website and thought you'd like it too.
Two recent imputed income cases discuss the proper amount of imputed income to use when calculating alimony and child support. Both of these imputed income cases were released in June 2012 from the Fourth District Court of Appeal in West Palm Beach.
Imputed Income Cases
In Vitro v Vitro, the court imputed income of $30,000 to the former wife. That had been her started salary at a real estate firm in 2005. She was promoted and received raises and earned $60,000 in 2009 before her employment ended. After the trial ended, she got a job for $15/hour with no benefits or overtime. Mr. Vitro thought his former wife should have looked for management jobs in addition to administrative assistant jobs. The appeals court found that the trial court is in the best position to make the determination of what the proper amount of imputed income was for the wife. There is a good explanation of how the court has to determine imputed income in the decision.
In another Fourth District case on imputed income, Mr. Piedra was charged with imputed income in an amount equal to last year's gross business profit by the trial court. After describing the process for imputing income, the court decided that it was an error to charge him with the gross profit amount. Any business income, including imputed income, has to be the NET income - income less legitimate business expenses.
The court also noted that the former husband had started a new business with his brother - and it had a similar name to the family business he closed just before the divorce. While claiming no income form the new business, Mr. Piedra took a job as a mechanic for $400/week - about 20% of his former income.
DIY Imputed Income
It can be difficult to present a case involving imputed income when you are representing yourself. This is one case where I definitely recommend having an attorney represent you or at least coach you through the imputed income process. You can see from these new cases that it is not easy, even for attorneys, to present the evidence for imputed income cases.
In a recent temporary alimony appeal, the Fourth District Court of Appeal provided some wonderful lessons. It is always good to review some of the basics of law, and in the Coviello case, we can review some of those basics:
1. The Court has a high level of discretion when entering temporary relief orders and they are not likely to be overturned on appeal
2. The test for awarding alimony - temporary or permanent - is the need of one spouse and the ability of the other spouse to pay
3. Evidence of need and ability must be presented at the hearing
4. Even in a marriage in which permanent alimony is unlikely, temporary alimony can and will be awarded while the case is pending.
Temporary alimony or temporary support cannot be waived in a prenuptial agreement, even today. That means you may want to reconsider leaving the marital home if you are likely to be the paying spouse. And if you are the receiving spouse, staying in the marital home may mean a higher temporary alimony award due to higher expenses. It is something to consider anyway.
Once the court enters a temporary alimony or temporary relief order, it is likely to live with that order until the final judgment is entered. That could be a matter of months, or even in some cases, years of paying temporary alimony. Sometimes the temporary alimony order diminishes the incentive of one spouse to move the case along, especially when the paying spouse has the ability, like Mr. Coviello, to meet all of the receiving spouse's needs. In a situtation like this, of course, the paying spouse is highly motivated to end the case quickly to avoid the continued payment of temporary alimony.
While the Coviellos provided a good legal review, the reality is that they had to get through many steps just to reach a temporary relief hearing. Since temporary relief is based on the incomes and expenses of the spouses, financial affidavits must be completed and filed. Evidence must be gathered as to need and ability. In most areas of Florida, a mediation session must occur before a temporary relief hearing can be scheduled.
When you represent yourself, it is common to just make an agreement on who pays what while the divorce case is pending. For most couples, this works fine. But you have to realize that without an order, the court has nothing to enforce if the paying spouse stops paying temporary relief payments. If that happens, you will have to file a motion for temporary relief and go through all of the steps to get to a temporary relief hearing and court-ordered temporary alimony or child support.
As if watching HB 549 and the Senate Bill were not enough, also keep your eye on House Bill 565. It also contains many alimony provisions in it. Here's the summary of House Bill 565:
Family Law: Includes value of marital portion of passive appreciation of nonmarital real property in marital assets; authorizes security & payment of reasonable rate of interest if installment payments are required for distribution of assets & liabilities; requires written findings for installment payments; requires use of formulas for calculation of marital portion of nonmarital real property subject to equitable distribution unless evidence shows that application inequitable; revises requirements relating to awarding of durational alimony; requires written findings regarding incomes & standard of living of parties after dissolution; revises provisions relating to effect of supportive relationship on alimony; authorizes court to award attorney fees & costs to obligor; requires imputation of income to obligee in accordance with child support guidelines; prohibits separate adjudication of issues in dissolution of marriage case within 180 days after filing without exceptional circumstances; authorizes separate adjudication of issues if case is more than 180 days past; requires separate adjudication of issues, absent showing of irreparable harm, if case is more than 365 days past.
If you want to read the whole bill, click this link to the PDF. Like House Bill 549, House Bill 565 was referred to the House for a vote on President's Day. mWe'll keep you posted on the progression of alimony reform in Florida as these bills move thorugh the Florida Legislature.
This latest House Bill 549 has been referred for a vote by the Florida House. (It was referred today, which is a holiday and thus, quite unusual.) Remember that the House approved the original bill on its first day of session. To stay up-to-date with where House Bill 549 is at any given time, you can check on the House website here.
All of the proposed aliony reform bills filed in Florida this session end permanent alimony in favor of "long term" alimony. The same thing is happening in the New Jersey legislature. Make no mistake, the folks advocating for this reform have made reat inroads in reducing alimony in Florida.