518A.32 and Expectation of Parental Income

Divorce, child custody, and child support all carry with them some serious financial implications. Any time parents separate or divorce, they will need a final decree setting forth each party’s respective parenting time, as well as an order providing for financial support for the children. Minnesota sets child support according to a particular formula which takes several factors into account, including both of the parties’ incomes. If both parties have steady, full-time jobs where they have worked for years, setting income is a fairly straight forward task. However, where one party does not have a job or works only part-time, it can be more complicated. Minnesota statute 518A.32 deals with “potential income” for parents and how to deal with setting child support in these types of cases.

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This statute states that where a parent is “voluntarily unemployed, underemployed, or employed on a less than full-time basis” then child support must be calculated by using a potential income. This statute also applies where there is no evidence of parental income, such as where a parent refuses to appear in court and there is no other source to prove his or her past income. Subsection 2 provides the three separate methods for determining potential income. The first is to look at the parent’s employment potential, qualifications, and recent work history. The second is if a parent is receiving workers’ compensation or unemployment benefits, the actual amount of income from those sources should be used. Finally, if neither of these is appropriate to apply, the income will be set at the amount the parent would earn if he or she was working thirty hours per week at the current federal or state minimum wage, whichever is higher.

Determining a parent is voluntarily underemployed or unemployed is appropriate where a parent is completely capable of working or earning a higher wage but does not have a good justification for not doing so. Subsection 3 of the statute specifically spells out that the statute will not apply where the person is unemployed temporarily and there will be an increase in income, the person has made a “bona fide career change” that has benefits to the child that outweigh the decrease in income (such as a job change to be able to actually spend time with the child), or where the unemployment is a result of incapacity or incarceration (unless the incarceration is a result of failure to pay child support). In short, the statute is designed to make sure that a parent cannot simply elect not to work in order to reduce the support or increase the obligation of the other parent. If a parent is capable of working, the Minnesota courts will not allow an income to be set at zero or artificially low.

We have extensive experience helping our clients understand their rights and responsibilities when it comes to setting child support. Call us today to talk about your children and your financial situation.