Exploring the Sources of Income for Child Support in New Jersey

Reviewed by Stephanie Albrecht-Pedrick, Esq.

Child support is a crucial financial responsibility that parents must fulfill to ensure the well-being of their children. In New Jersey, as in many other states, child support is determined based on various factors, including the income of both parents. “Income” includes more than just wages. If you are seeking child support, or if you are the one who will pay child support, it is essential that you understand the sources of income that the court will consider in calculating child support.

In New Jersey, child support obligations are primarily calculated based on the “Income Shares Model,” which considers the combined income of both parents. This model aims to ensure that children receive the same proportion of parental income after a separation or divorce as they would have received if the family had remained intact. It’s critical to note, however, that these guidelines run on net income. The court begins with gross income, then subtracts necessary taxes, mandatory union dues, mandatory retirement contributions, and existing child support orders. Let’s delve into the key sources of income that are typically included in child support calculations in New Jersey:

Sources of Income Counted in a New Jersey Child Support Calculation

1. Wages and Salary

The most common source of income considered for child support calculations is the wages and salary earned by each parent. This includes gross income from employment, bonuses, tips, overtime pay, and commissions. Parents must provide accurate information about their earnings.

2. Self-Employment Income

For parents who are self-employed or own a business, their income from self-employment is also factored into child support calculations. This includes profits from the operation of a business, professional practice, or freelance work. Determining self-employment income can sometimes be complex, as it may involve assessing business expenses and deductions.

3. Investment Income

Income from investments, such as dividends, interest, capital gains, and rental income, is another source that may be considered for child support purposes. Parents are typically required to disclose their investment income as part of the financial disclosure process during child support proceedings.

4. Retirement Benefits

Retirement benefits, including pensions, 401(k) distributions, and Social Security retirement and disability benefits, may also be included in the calculation of child support in New Jersey. These benefits are considered part of the overall income available to a parent for the support of their children.

5. Unemployment Benefits

In cases where a parent is receiving unemployment benefits, such income may be factored into child support calculations. It is important for parents to report any changes in their employment status or income to the relevant authorities to ensure that child support obligations are adjusted accordingly.

6. Income from Second Jobs or Side Businesses

If a parent has additional sources of income from second jobs, side businesses, or freelance work, such income may also be considered for child support calculations. It is crucial for parents to provide comprehensive information about all sources of income to facilitate an accurate determination of child support obligations.

7. Income from Rental Properties or Royalties

Income derived from rental properties, royalties, or other sources of passive income may be factored into child support calculations in New Jersey. Parents should be prepared to disclose all relevant sources of income to ensure a fair assessment of their child support obligations.

8. Alimony Received

The court will consider alimony or separate maintenance received from a current or past relationship as income. Alimony paid is ultimately deducted.

9. Income That Does Not Count

It’s important to understand that Appendix IX-B does exclude a number of income sources. This includes:

• Social Security Income (SSI)
• Supplemental Nutrition Assistance Program (SNAP) income
• Kinship guardian subsidies
• Temporary Assistance for Needy Families (TANF)
• Refugee assistance
• Rent subsidies
• Deficit Reduction Act benefits
• Non-income producing assets, like undeveloped real estate or stocks and bonds

Documents Courts Require to Verify Income

Courts require submission of documents to support income, including recent paystubs, and tax returns from multiple years. Courts will also review W2’s, 1099’s, and other supporting tax forms to substantiate and confirm income information.

Talk to a New Jersey Family Law Attorney

In conclusion, understanding the various sources of income that are considered for child support calculations in New Jersey is essential for parents navigating the child support system. With accurate and comprehensive information about their income, parents can be confident that the child support calculation is fair and in the best interest of their children. Parents who have questions or concerns about child support calculations should consult an experienced family law attorney.

To learn more about your rights and obligations, call the office to schedule a consultation.