Business owners understand risk. Though there’s no guarantee that your business is going to succeed, divorce adds a whole new level of uncertainty for business owners.
How Does My Business Impact Child Support?
In order to make sure that child support is properly calculated, and that each child’s needs are adequately provided for, it’s important that the courts have a clear picture of your finances as a business owner. The income generated by your business will be factored into child support calculations. There are no simple answers, but experience can provide some indication of what to expect.
The best way to ensure that your child support payments are proportional to your income is to provide complete and accurate financial statements. If your income regularly fluctuates, do not imply that one particular statement is indicative of how they all look.
If you can provide accurate documentation that proves where your money is coming from and what it is going to every month, you’ll be putting your best foot forward with the court and help to ensure that the child support payment amounts that the court orders are calculated properly. With accurate documentation provided, your attorney will be able to work towards a reasonable resolution that respects your family and your business.
Child support payment amounts are typically calculated by the court based on the obligor’s net monthly income, subject to statutory guidelines. In limited circumstances, the court may deviate from these guidelines.
Approaching Divorce Negotiations as a Business Owner
In the midst of a divorce, feelings of uncertainty and fear are normal, especially when there is a business on the line, but those feelings don’t need to take center stage when all parties demonstrate a commitment to effective collaboration.
A willingness to approach divorce negotiations with an open mind and the goal of a mutually beneficial division of assets as well as in matters related to child support is also important in achieving a settlement that all parties can agree on. One thing you can do as a business owner that can make this easier is to keep your business and personal finances completely separate. If you can provide clear documentation that shows your business is not connected to your personal assets aside from the regular paychecks that the business pays you, this reported income should form the basis of calculations of child support.
The farther apart you keep your personal and business finances, the better off you’ll be.