Announcement

Collapse
No announcement yet.

Is this considered available income?

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • Is this considered available income?

    My ex provided partially updated financial disclosure. I have a question about what is considered "available" income for spousal and child support purposes.

    I understand if my ex was keeping money in his corporation in cash most of that money would be considered available income for support purposes.

    It looks like in the last year he purchased a couple of investment properties. I don't know the exact amount of how much everything cost but lets say the down payment is 250k.

    If he was sitting on this 250k in cash I would get support calculated on this amount easily. But if this money is used to buy an investment property it forms part of his overall net wealth. So instead of getting support on this 250k would I only be getting support payments on the rental income generated from this 250k?

  • #2
    Originally posted by Brampton33 View Post
    Although I disagreed with OPs stance provided in previous posts regarding entitlement, I will say that her ex purchasing investment properties in advance of finalizing their separation through formal agreement or court order was actually foolish. Quite foolish.

    When you both provide financial statements, the value of the investments must be reflected in his assets. Most people try to “hide” assets by “giving” their parents and friends HUGE sums of money prior to filing statements, to make it look like they are worth much less than they really are. OP’s ex did the opposite by increasing his worth in advance of filing statements and finalizing equalization.

    I have read OPs posts, and to be honest the best and most liberating thing OP can do is finalize the separation once and for all....it’s been 5 years and OP had a new boyfriend so cut ties fully with ex. The outcome of the situation will see OP get fair share of equalization and spousal support (for a few years) as well as offset child support. The current house will be sold so best to accept it and seek a new start somewhere else.
    I am trying to get the best settlement possible. My ex knows I'll question large transfers of money to friends and family so I'm trying to figure out if this is a loophole he's trying to use. That's why I'm questioning if the purchases of these investment properties will help or harm my overall case.

    Comment


    • #3
      I understand if my ex was keeping money in his corporation in cash most of that money would be considered available income for support purposes.
      Not exactly. Different businesses can justify holding onto different amounts of cash for genuine business purposes. For example, if I own a factory and I'm planning to expand operations with a new building, I might retain a lot more 'cash' than I strictly need for daily operations, but it's justified. Since it's part of a bona fide business plan, it's not necessarily income.

      It looks like in the last year he purchased a couple of investment properties. I don't know the exact amount of how much everything cost but lets say the down payment is 250k.
      Then the money used for this venture would almost certainly be income for support purposes.

      Comment


      • #4
        Originally posted by Brampton33 View Post
        No offence, but this sounds like pure greed where you try to mooch as much as possible out of your ex from 5 years ago. Your focus should be getting what is fair and equitable as defined by the law. If you sat down with a good lawyer, he/she would explain how equalization works, and the matter would be settled with little to no need for court. Other lawyers might encourage you to squeeze for as much as you can. The delay will only drag things out in the court system, costing you more in legal fees than you actually receive from your ex in the end.
        Equalization by the letter of law and "fair and equitable" are two different things. I struggle to think of any other legal situation where so much INequitable division happens besides family law. In my situation- there was an understanding- written between my ex and I that, by me paying for our entire wedding (~$75k), that I would be buying my equity into the condo he owned at the time. The problem is that I paid for the majority of the expenses BEFORE the date of marriage- therefore I didn't have that money reflected as an asset to subtract from my NFP. But my ex got to subtract the full amount of the equity in the condo (which was our first marital home)....it IS a simple calculation. One that is often unfair and unequitable. And as MANY posters will attest to on this board- the higher income earner almost always gets screwed in the division of family wealth. I suspect that is just the golden rule for marriage and divorce?

        At a settlement conference the judge told me that I had an uphill battle for unequal equalization- and told my ex that I had a good case to argue equity- and for us to settle the matter. That's why we ultimately settled on splitting the difference and putting the full amount into an RESP for D4.

        The issue becomes a lot of real world fairness/equity issues come into play in each individual case. I don't know the OPs background to this. But it's often simple to say "the law says what is fair in equalization" -but the equity part of it? different story.

        Comment


        • #5
          Originally posted by iona6656 View Post
          Equalization by the letter of law and "fair and equitable" are two different things. I struggle to think of any other legal situation where so much INequitable division happens besides family law.
          Couldn't agree more. My ex was being unreasonable for both parenting time of kids, as well as, equalization. Rather than drag things out for years and flush money down the toilet in ongoing legal fees, I focused on solidifying 50/50 parenting and let go of any arguments related to fair equalization. Even though I has an overwhelming evidence that my ex's proposal for equalization was junk, being present in my childrens' lives was and always will be the priority. Family Law is ridiculous on how it lets people act incredibly unreasonable, wasting time and legal fees, with zero repercussions for such behaviours except through a costs award at trial or motion.

          Comment


          • #6
            Kinso is a lawyer and knows more than us but I would like to add that the rental income from the investment properties would be income for support purposes but the amount he had to buy them is only income in the year he purchased. Although I find it odd that it would be considered as income if it came from savings. For instance, he saved 50 grand for three years and then used it to buy properties say last year. That money was savings not income. If he didnt start gaining a rental income until this year, you cant back date the amounts to before he bought the places.

            As always, you would have to prove your argument and just because you think he took more money from his business doesnt mean it actually happened. You may need a forensic accountant to determine these trails of money. A few weeks ago you said he wanted the house sold so he could buy his own place now you are postulating he hid money to buy property. Its a bit of a stretch and judges dont like false allegations.


            Sent from my iPhone using Tapatalk

            Comment


            • #7
              Although I find it odd that it would be considered as income if it came from savings.
              Only if was earned income in the corporation in the year it was taken out to purchase the investments. The devil is in the details which is why this forum is useful, but far from infallible.

              Comment


              • #8
                Originally posted by Kinso View Post
                Only if was earned income in the corporation in the year it was taken out to purchase the investments. The devil is in the details which is why this forum is useful, but far from infallible.

                Well I also dont trust this poster on their details. Which is why I suggest a forensic accountant.


                Sent from my iPhone using Tapatalk

                Comment


                • #9
                  Originally posted by Kinso View Post
                  Not exactly. Different businesses can justify holding onto different amounts of cash for genuine business purposes. For example, if I own a factory and I'm planning to expand operations with a new building, I might retain a lot more 'cash' than I strictly need for daily operations, but it's justified. Since it's part of a bona fide business plan, it's not necessarily income


                  Then the money used for this venture would almost certainly be income for support purposes.
                  My ex is an accountant and works for a large firm. He has a corporation and I was added as a shareholder for dividend splitting purposes so he has no reason to retain cash.

                  Are you saying that if he used this hypothetical 250k to purchase a property this would get added as his income that gets used for support calculations AND and rental income would be included as part of that?

                  Comment


                  • #10
                    Originally posted by iona6656 View Post
                    Equalization by the letter of law and "fair and equitable" are two different things. I struggle to think of any other legal situation where so much INequitable division happens besides family law. In my situation- there was an understanding- written between my ex and I that, by me paying for our entire wedding (~$75k), that I would be buying my equity into the condo he owned at the time. The problem is that I paid for the majority of the expenses BEFORE the date of marriage- therefore I didn't have that money reflected as an asset to subtract from my NFP. But my ex got to subtract the full amount of the equity in the condo (which was our first marital home)....it IS a simple calculation. One that is often unfair and unequitable. And as MANY posters will attest to on this board- the higher income earner almost always gets screwed in the division of family wealth. I suspect that is just the golden rule for marriage and divorce?

                    At a settlement conference the judge told me that I had an uphill battle for unequal equalization- and told my ex that I had a good case to argue equity- and for us to settle the matter. That's why we ultimately settled on splitting the difference and putting the full amount into an RESP for D4.

                    The issue becomes a lot of real world fairness/equity issues come into play in each individual case. I don't know the OPs background to this. But it's often simple to say "the law says what is fair in equalization" -but the equity part of it? different story.
                    I met my ex while he was completing his CPA. I helped him with expenses when he wasn't making money and after I started relying on him to pay my expenses he decided I wasn't worth it anymore.

                    Comment


                    • #11
                      Originally posted by LovingDad1234 View Post
                      Couldn't agree more. My ex was being unreasonable for both parenting time of kids, as well as, equalization. Rather than drag things out for years and flush money down the toilet in ongoing legal fees, I focused on solidifying 50/50 parenting and let go of any arguments related to fair equalization. Even though I has an overwhelming evidence that my ex's proposal for equalization was junk, being present in my childrens' lives was and always will be the priority. Family Law is ridiculous on how it lets people act incredibly unreasonable, wasting time and legal fees, with zero repercussions for such behaviours except through a costs award at trial or motion.
                      My ex and I have a 50/50 parenting schedule. My kids are very close with him but I am battling it out for a fair equalization and support payments.

                      Comment


                      • #12
                        Originally posted by rockscan View Post
                        Kinso is a lawyer and knows more than us but I would like to add that the rental income from the investment properties would be income for support purposes but the amount he had to buy them is only income in the year he purchased. Although I find it odd that it would be considered as income if it came from savings. For instance, he saved 50 grand for three years and then used it to buy properties say last year. That money was savings not income. If he didn�t start gaining a rental income until this year, you can�t back date the amounts to before he bought the places.

                        As always, you would have to prove your argument and just because you think he took more money from his business doesn�t mean it actually happened. You may need a forensic accountant to determine these trails of money. A few weeks ago you said he wanted the house sold so he could buy his own place now you are postulating he hid money to buy property. It�s a bit of a stretch and judges don�t like false allegations.


                        Sent from my iPhone using Tapatalk
                        His partial updated financial disclosure looks like he took out loans to make the down payment instead of cash from the company. I want to hire a forensic accountant to look into his books but I don't have the funds for that. My ex is an accountant he knows all the tips and tricks that can be used to screw me.

                        I told my son we may have to move to a condo. He stated he will live with his father if I can only afford a condo. I am not going to let my ex purchase a house and be seen as the "winner" with a house while I am the loser mom with a condo because my ex decided to not give me enough money to live.

                        Comment


                        • #13
                          Originally posted by trueblue22 View Post
                          I am not going to let my ex purchase a house and be seen as the "winner" with a house while I am the loser mom with a condo because my ex decided to not give me enough money to live.

                          And herein lies your problem.

                          You will be the loser mom for many reasons...like quitting a good paying job, spending thousands on legal fees only to lose, fighting for things you arent entitled to and allowing your kids to dictate to you.


                          Sent from my iPhone using Tapatalk

                          Comment


                          • #14
                            Originally posted by trueblue22 View Post
                            His partial updated financial disclosure looks like he took out loans to make the down payment instead of cash from the company. I want to hire a forensic accountant to look into his books but I don't have the funds for that. My ex is an accountant he knows all the tips and tricks that can be used to screw me.

                            I told my son we may have to move to a condo. He stated he will live with his father if I can only afford a condo. I am not going to let my ex purchase a house and be seen as the "winner" with a house while I am the loser mom with a condo because my ex decided to not give me enough money to live.
                            look- I know coming out the financial "loser" in these situations feels like someone stuck a red hot lump of coal in your stomach coated with a good deal of shame thrown in.

                            both my ex and his sister are CPAs- and about a month before our separation (which was precipitous) he started withdrawing funds and doing all kinds of shady shit. He put a lock on his "office" in our house.

                            all this to say- spend your money on therapy and dealing with where your life goes from now. There will be an end to all of this- and from the sounds of it- your ex is going to always have more money than you. So you can either move on and live a good life- or hold onto this.

                            question- why is it that you can't earn enough money on your own to live?
                            Last edited by iona6656; 04-07-2021, 11:54 AM.

                            Comment


                            • #15
                              Originally posted by iona6656 View Post
                              question- why is it that you can't earn enough money on your own to live?
                              Oh iona, go back and read this ones posts. She quit her relatively high paying job to start her own business, pays her new bf a salary but not herself and has expected her ex to pay for her lifestyle the last four years. Hes finally pulled the trigger on ending this mess but she wants to continue to live the high life on his dime.


                              Sent from my iPhone using Tapatalk

                              Comment

                              Our Divorce Forums
                              Forums dedicated to helping people all across Canada get through the separation and divorce process, with discussions about legal issues, parenting issues, financial issues and more.
                              Working...
                              X