Imputing Income

Imputed Income. The Appeals Court affirmed a divorce judgment in which an annual income of $120,000 was imputed, or attributed, to the wife, finding that she could earn such income “with reasonable effort.”  The wife in this case had a history of earning a salary in that range and her underemployment was a result of her “unilateral decision.”  Alexander v. Alexander, 72 Mass.App.Ct. 1118 (September 30, 2008) (Unpublished)
 
Imputing Capital Gains and Broker Fees.  A former husband appealed from a divorce judgment relative to a particular property division.  Among his claims, he disagreed with the judge’s rejection of his request to have capital gains tax and real estate broker’s fees taken into account in valuing a particular property.  The Appeals Court upheld the judgment, noting that “without evidence that the husband intended to sell the property or would be compelled to sell the property as a result of the division of assets, it was not clearly erroneous for the judge to decline to consider adverse capital gains tax consequences or broker’s fees.”  If Bernier v. Bernier, 449 Mass. 774 (2007) had not already done so, this is yet another “nail in the coffin” for imputing broker’s fees and capital gains where no sale of the at-issue property is imminent.   Gentilella v. Fillion, 73 Mass.App.Ct. 1121 (February 13, 2009) (Unpublished)
 
Imputing Income and Divorce Planning.  The Appeals Court affirmed a judgment in which the trial court refused to impute income to a wife who was working an 80% schedule at the time of trial and who was earning an annual salary of over $500,000.  The Appeals Court was impressed that throughout the marriage, she had often reverted from full-time to reduced-time and that the current schedule was not the result of “divorce planning.” Lanes v. Jagolta, 2010 Mass.App.Unpub. LEXIS 1069 (September 24, 2010) (Unpublished)
 
Imputing Income: Reasonable Efforts to Find Employment.  The Probate and Family Court imputed income to an ex-wife based on her present ability to obtain employment.  On appeal, the Appeals Court reminds us that the test for imputing income is a two-part inquiry: (1) whether the person has a present ability to obtain a particular job and (2) whether the person exercised “reasonable efforts” in the job search.  Here, the trial court made no findings regarding the second requirement.  Accordingly, the case was remanded to the trial court for further fact finding on the “reasonable efforts” issue.  Ulin v. Polansky, 83 Mass.App.Ct. 303 (February 19, 2013)