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.

The Goal of Alimony

Alimony (also known as spousal support) allows many individuals to get divorced and end abusive or unhappy marriages by awarding ongoing financial support during and after a divorce.  California family courts grant alimony only in cases where they can determine that alimony is necessary.  There are several types of alimony available after you file for divorce. Consult with a family law attorney to learn how to ask for spousal support and find out whether you’re entitled to temporary or permanent spousal support when you file for divorce.

The main goal of alimony is to give a spouse ongoing financial support after the marriage.  A spouse no longer has to stay in a bad marriage for fear of losing financial support and comfort. A spouse can get a divorce and receive financial support temporarily to help get back on their feet or, in some cases, maybe even permanently. 

How To Get Alimony

To receive alimony, you will need to prepare a strong argument about why you need it. Courts typically grant alimony to spouses who can demonstrate they need it. Alimony is typically granted in these or similar circumstances, but it can be granted in other cases as well:

• A disability or health concern that makes it hard to support yourself.
• A very long marriage, and you are accustomed to being supported.
• Stay at home parent who cares (or cared) for the children or home.

Depending on the reasons that you request alimony, the court still needs to make a full assessment of your alimony claim.  Family law courts apply different alimony factors listed under California Family Code § 4320 in deciding whether to grant permanent alimony.  These factors range from the spouse’s income and assets to each spouse’s needs and the standard of living to which the couple were accustomed. Other factors that will be considered are each spouse’s age, health, and contribution to the other’s education or professional license.

If you are considering getting divorced, but you are concerned about how you will be able to support yourself during and after the divorce, speak with a California family law attorney. An attorney can explain your options and help you understand whether you might qualify for temporary alimony or permanent alimony, as well as the possible amount. An attorney can also help you develop a strong case for spousal support to be presented to the family court judge.

Another unexpected consequence of the coronavirus – couples across the state who have to wait to untie the knot.

‘A Waiting Game’: Coronavirus Shutdowns Cause Unprecedented Backlog In Divorce, Family Law Cases — CBS Los Angeles

In California, many types of property are divided equally in divorce. California is a community property state, meaning that with limited exceptions property acquired during marriage is classified as community property and subject to equal division in divorce. However, even when some types of property are classified as community property, they’re not divided equally. One of those types of community property that are NOT divided equally in divorce are “community estate personal injury damages.”

Personal Injury Damages Are Community Property

Family Code Section 780 states:

money and other property received or to be received by a married person in satisfaction of a judgment for damages for personal injuries, or pursuant to an agreement for the settlement or compromise of a claim for such damages, is community property if the cause of action for the damages arose during the marriage.

Family Code 780

In light of Family Code 780, personal injury damages for a claim that arose during marriage are considered community property. For example, if a husband was injured in a car accident during marriage and filed a personal injury lawsuit, any subsequent settlement or judgment proceeds would be classified as community property.

Personal Injury Damages Exception To The Community Property Division Rule

While Family Code 780 classifies personal injury damages as community property, Family Code 2603(b) creates an exception to the 50/50 division rule for this form of community property. The statue reads:

(b) Community estate personal injury damages shall be assigned to the party who suffered the injuries…

Family Code 2603(b)

Therefore, while personal injury damages for a claim that arose during marriage are community property, they are generally awarded to the injured spouse. The only instance in which the court can award some of the damages to the non-injured spouse are when the “interests of justice” require such after considering the needs and economic condition of the parties, time since recovery of the personal injury damages, and all other facts of the case. (See Family Code 2603(b)).

In ordering permanent spousal support, the family court must consider the extent to which each party’s earning capacity can maintain the standard of living established during marriage. Accordingly, the court must consider the following factors in its spousal support decision: (See Family Code 4320(a))

• The recipient’s marketable skills
• The job market for those skills
• The time and expenses required for the recipient to gain the appropriate education or training to cultivate marketable skills
• The need for retraining or education to gain more marketable skills or employment
• The extent to which the recipient’s present or future earning capacity is impaired by periods of unemployment during the marriage to permit the recipient to devote time to domestic duties.

Read the entire article on https://rosevilledivorce.com/spousal-support/earning-capacity/ – the website of family law attorney Jin Kim.