Compensation packages
As an employee you're employer may have a number of ways in which they compensate you. That might be a combination of any of the below:
For the purposes of a divorce, and more specifically for child and spousal support these are additional sources of income that might be considered:
- Base Pay / Salary
- Commission
- Overtime Pay
- Bonuses / Profit Sharing / Merit Pay
- Stock Options / Restricted Stock / Restricted Stock Units (RSU) - vested and not vested
- Fringe Benefits
- Travel / Meal / Housing Allowance
- Medical / Dental / Life Insurance
- Retirement Assets
For the purposes of a divorce, and more specifically for child and spousal support these are additional sources of income that might be considered:
- Capital Gains
- Dividends and Interest
- Rental Income
- Pension Payments
- Social Security
- Gifts and Inheritance
- Cash Payments
- Business Perks
- Certain Expenses Deducted by a Business
- Certain Types of Depreciation
Many professionals besides being paid a regular salary also receive a major part of their compensation in the form of a bonus, some form of stock interest and or retirement savings plans. As such, these are a significant consideration in a divorce and must be addressed in the right way. It can affect the size of the assets in the divorce as well as child and spousal support obligations.
A business owner's income might not be as straight forward. They might or might not take a salary, bonus and pension benefits yet still be able to maintain a good life style. This could be because they benefit from capital gains, depreciation and or ability to write of certain expenses. For that reason it is often necessary normalize their income for the purpose of divorce, child and spousal support.