Covid and Imputation of Income

Snowden v. Jaure, (Wyoming Supreme Court)

With Covid-19 raging for over a year now, many families have been affected and often negatively. Job loss is just one consequence of the pandemic. This has caused a loss in income for many individuals. In families going through a custody case, it means that child support calculations are going to be affected. Now one state has litigated one such Covid-19 case all the way to their state’s supreme court.

As a primer, child support is typically based partly on the income of the parents. If one parent’s income changes drastically, most courts will allow for a modification of the child support obligation. However, sometimes the court can be allowed to impute income to a parent that has voluntarily depressed their income. This was true in Wyoming, and it is true in North Carolina.

In this case, Mother lost her job due to cutbacks in the oil industry due to the pandemic. She also did not seek another job because, rather than send her children to daycare during the pandemic, she wanted to care for them at home. She testified that she was going to get her old job back but was unsure about whether her salary would be the same. The trial court ultimately granted a modification of child support, and imputed Mother’s income at an amount that she was making at her old job. But the court also deducted 25% from each parent’s income because “it is a tricky time in Wyoming with the industry…”

The state Supreme Court ultimately held that there was no error in imputing the income, or the 25% “tricky time” discount. First, the imputing of income was appropriate when a party voluntarily depresses their income. Moreover, Mother had testified that she would be getting this old job back in a few months’ time. Therefore, using her previous salary was reasonable. As for the 25% discount, the Court wrote that this method of computing support “causes us concern.” But ultimately, since the discount was applied to both Mother and Father, and no authority had been cited that would prove why the discount was error, the Supreme Court did not truly address the issue.

Covid will have lasting implications on family law. This child support imputation is just one aspect of the wider issue. At least in Wyoming, Covid was not a way out of imputation of income.