Ottawa Divorce .com Forums


User CP

New posts

Advertising

  Ottawa Divorce .com Forums > Main Category > Financial Issues

Financial Issues This forum is for discussing any of the financial issues involved in your divorce.

Reply
 
Thread Tools
  #1  
Old 09-15-2014, 10:34 AM
movingON1975 movingON1975 is offline
Senior Member
 
Join Date: Aug 2014
Posts: 101
movingON1975 is on a distinguished road
Default Section 7 with imputed income on recipient

Hey all....

I've got a question regarding section 7 expenses with imputed income on the recipient.


Ex has physical custody, and has income imputed against her. She earns ~$10,000 yr but has an imputed income of ~$30,000 yr. The difference is by her choice, she fully admitted to not wanting to work during a deposition.. it was pure gold. And a settlement was reached a few days later.


She receives around $2,500 a month in spousal support from me. Plus about another $1,000 in child support.


In calculating section 7 expenses, how is the tax credit for day care handled?

Is there anyone else on the board whom has done this calculation for imputed income by the recipient?
ie should the tax credits be calculated as if she makes $30,000 + (12x$2,500) = $60,000 as opposed to $40,000 which is a lower tax bracket, etc...


Thanks!
Reply With Quote
  #2  
Old 09-15-2014, 10:54 AM
MS Mom MS Mom is offline
Senior Member
 
Join Date: Aug 2013
Posts: 1,160
MS Mom is on a distinguished road
Default

The first thing to remember about tax credits is that if the person's income is below personal exemptions (plus any amounts for dependents) then there is NO TAX CREDIT for expenses as there is no tax paid.

Imputed income of $30,000 may generate a tax credit, however if her actual is $10,000 she has paid zero personal income tax and therefore receives zero credit.
Reply With Quote
  #3  
Old 09-15-2014, 11:00 AM
movingON1975 movingON1975 is offline
Senior Member
 
Join Date: Aug 2014
Posts: 101
movingON1975 is on a distinguished road
Default

Quote:
Originally Posted by MS Mom View Post
The first thing to remember about tax credits is that if the person's income is below personal exemptions (plus any amounts for dependents) then there is NO TAX CREDIT for expenses as there is no tax paid.

Imputed income of $30,000 may generate a tax credit, however if her actual is $10,000 she has paid zero personal income tax and therefore receives zero credit.
Agreed and understood 100%. Do note that her taxable income is a lot higher than $10,000 since she also gets ~$30,000 yr in spousal support from me.

However, the crux of the question is with the effect of imputed income.

She agreed to earn $30,000 a year, and chooses not to, so she doesn't get the tax credits. So in my mind she should have to cover the lost tax credits... i can find lots of information on section 7 calcs, but none where the recipient has imputed income...

Last edited by movingON1975; 09-15-2014 at 11:11 AM. Reason: no need for bold
Reply With Quote
  #4  
Old 09-15-2014, 11:11 AM
MS Mom MS Mom is offline
Senior Member
 
Join Date: Aug 2013
Posts: 1,160
MS Mom is on a distinguished road
Default

Quote:
Originally Posted by movingON1975 View Post
Agreed and understood 100%. Do note that her taxable income is a lot higher than $10,000 since she also gets ~$30,000 yr in spousal support from me.

However, the crux of the question is with the effect of imputed income.

She agreed to earn $30,000 a year, and chooses not to, so she doesn't get the tax credits. So in my mind she should have to cover the lost tax credits... i can find lots of information on section 7 calcs, but none where the recipient has imputed income...
I understand the spousal support income. Depending on how many dependents, etc. the actual taxable income may be negligible.

If she has co-habitated then these credits are also based on household income.

My ex requested my entire tax return and the NOA in order to determine the tax credits I was receiving for S7 activities.
Reply With Quote
  #5  
Old 09-15-2014, 11:15 AM
movingON1975 movingON1975 is offline
Senior Member
 
Join Date: Aug 2014
Posts: 101
movingON1975 is on a distinguished road
Default

Quote:
Originally Posted by MS Mom View Post
I understand the spousal support income. Depending on how many dependents, etc. the actual taxable income may be negligible.
One child.


Quote:
Originally Posted by MS Mom View Post
If she has co-habitated then these credits are also based on household income.
Ah, very true, but not the case here.

Quote:
Originally Posted by MS Mom View Post
My ex requested my entire tax return and the NOA in order to determine the tax credits I was receiving for S7 activities.
I haven't seen a return or NOA since 2011s. She refuses to show me, said its none of my business. It is good that you two can get along at least somewhat..
Reply With Quote
  #6  
Old 09-15-2014, 11:20 AM
MS Mom MS Mom is offline
Senior Member
 
Join Date: Aug 2013
Posts: 1,160
MS Mom is on a distinguished road
Default

Quote:
Originally Posted by movingON1975 View Post
One child.




Ah, very true, but not the case here.



I haven't seen a return or NOA since 2011s. She refuses to show me, said its none of my business. It is good that you two can get along at least somewhat..

Oh, we don't get along. He wanted all that information while denying to pay the expenses the credits were for. And, for the record, the lawyer found $9 of credits.

Her NOA is your business. Is there not a clause in your agreement that you exchange this information annually? How do you determine how much of the expense is yours without knowing her income?
Reply With Quote
  #7  
Old 09-15-2014, 11:26 AM
movingON1975 movingON1975 is offline
Senior Member
 
Join Date: Aug 2014
Posts: 101
movingON1975 is on a distinguished road
Default

Quote:
Originally Posted by MS Mom View Post
Oh, we don't get along. He wanted all that information while denying to pay the expenses the credits were for. And, for the record, the lawyer found $9 of credits.

Her NOA is your business. Is there not a clause in your agreement that you exchange this information annually? How do you determine how much of the expense is yours without knowing her income?
Found 9$ of credits, in how many billable hours?

I agree that the NOA is my business, there is only a clause that i will give her my NOA for a child support change, which she has been foot dragging on since June. I'm letting the NOA sleeping dog lie until I see that she is working.
Reply With Quote
  #8  
Old 09-15-2014, 01:41 PM
MS Mom MS Mom is offline
Senior Member
 
Join Date: Aug 2013
Posts: 1,160
MS Mom is on a distinguished road
Default

Quote:
Originally Posted by movingON1975 View Post
Found 9$ of credits, in how many billable hours?

I agree that the NOA is my business, there is only a clause that i will give her my NOA for a child support change, which she has been foot dragging on since June. I'm letting the NOA sleeping dog lie until I see that she is working.
I'm guessing the billable hours on that task was in the region of 3 - over and above the case conference argument for disclosure of this document. I advised his lawyer he could have the whole $9 on payment of the expenses.....he wasn't interested. LOL
Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Imputed Income for CS Frustrated_DAD Financial Issues 17 07-05-2011 03:41 PM
Ex is Military stillstrong Financial Issues 22 06-03-2011 07:31 PM
What counts? workingthruit Financial Issues 3 08-17-2007 12:56 PM
child support and EI beltane Financial Issues 3 06-07-2006 10:28 PM
Impact of Stocks on Child Support peter8688 Divorce & Family Law 4 01-04-2006 07:51 PM


All times are GMT -4. The time now is 11:36 AM.