Can the California family court look at my vacation property in calculating child support?

It’s not uncommon for a spouse to enter marriage with a vacation property. However, in the event of divorce a child support issue may arise: can the family court consider the parent’s ability to receive income from the vacation property in calculating child support?

If you own income producing assets like a vacation property the family court can, in it’s discretion, impute the earning capacity of the vacation property to the parent-owner. Even if the vacation property is used solely for personal use, it can generate income as a short-term rental property. Accordingly, the court has the ability to impute the earning capacity of the non-income producing vacation property against the owner-parent. In brief, just as the court can impute earning capacity for a voluntary reduction in income, the court can impute earning capacity for not utilizing assets that can produce income like a personal vacation property.

The California family court is guided by certain statutory principles in calculating child support. Some of those principles suggest why the family court deems it acceptable to impute the earning capacity of non-income producing assets such as vacation properties, even if those assets/properties are separate property. Namely, Family Code 4053 states in part

(a) A parent’s first and principal obligation is to support the parent’s minor children according to the parent’s circumstances and station in life.

(d) Each parent should pay for the support of the children according to the parent’s ability.

(e) The guideline seeks to place the interests of children as the state’s top priority.

(h) The financial needs of the children should be met through private financial resources as much as possible.

Family law cases involving imputed earning capacity are not straightforward. In the case of imputing earning capacity for underutilized assets, the court must determine a reasonable rate of return from the asset. That value isn’t necessarily determined by a past history of income from the asset; rather, the court may need expert testimony to learn what should be a reasonable rate of return. Accordingly, cases of this complexity require representation from a local family law attorney. In light of the number of court appearances that may be required, hiring a local family law attorney may save you some money in attorney fees for travel.

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