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Understanding the role of “imputed income” in determining alimony

On Behalf of | Feb 1, 2024 | Spousal Maintenance |

When judges determine how much alimony (or “spousal maintenance,” as it’s called in New York), a person is required to pay, one of the key factors is the income of both people. There’s also another important factor known as “imputed income.” 

Imputed income is essentially what a person could earn based on their education, skills, experience, age and the job market – in other words, their earning potential. Why is this important?

Unfortunately, some people try to avoid paying alimony or at least limit what they have to pay by choosing to be “underemployed.” They could pass up higher-earning jobs or elect not to take on new projects, for example. Those ordered to receive it, of course, can do the same. The latter is called “sandbagging.” 

Most people want to increase their income when they can, even if it means paying their ex more or not having to rely on their ex for alimony. However, sometimes the animosity between two former spouses is so extreme that they’ll pass up opportunities if they think taking them would in any way benefit their ex.

Generally, it’s a person’s former spouse who spots that their ex is staying underemployed or even unemployed to avoid greater alimony (and possibly child support) obligations and brings it to the court’s attention.

What do judges do in these cases?

A judge will consider the factors noted earlier in determining what a person’s imputed income should be. If they’re far below it, they may be required to show the court that they’re seeking a job that pays closer to that income or that they’re maximizing their potential for work if they’re an independent contractor.

Certainly, a judge will consider other relevant information. If the person who’s “underemployed” has begun caring for an elderly parent, has been in poor health themselves or is just getting back into the workforce after divorce, their earnings may not match their imputed income.

Whichever side of the fence you’re on, it’s crucial to make a strong case for modifying a spousal maintenance or child support order. Having experienced legal guidance can help you seek the outcome you believe is fair.