Does rental income count as income when calculating alimony?

[sook]

What is the name of your state (only U.S. law)? California

In a divorcing couple, the wife stayed in the jointly owned home and is paying the mortgage. She has tenants in the home and is collecting rental income from them. The husband inherited a house from his mother AFTER the date of separation and is renting it out, receiving income from that rental.

Do either of the spouses have to declare this rental income in the calculations for spousal support?

 

[Zigner]

What is the name of your state (only U.S. law)? California

In a divorcing couple, the wife stayed in the jointly owned home and is paying the mortgage. She has tenants in the home and is collecting rental income from them. The husband inherited a house from his mother AFTER the date of separation and is renting it out, receiving income from that rental.

Do either of the spouses have to declare this rental income in the calculations for spousal support?

Yes - there are places for it on the financial declaration forms.

 

[sook]

OK, thank you. We were told her rental income could not be included, but then she called into question his rental income. Seems like it should be both or neither.

Does she have a right to a piece of all his future endeavors--say he creates a phone app and makes a bunch of money off it, etc.?

 

[Zigner]

OK, thank you. We were told her rental income could not be included, but then she called into question his rental income. Seems like it should be both or neither.

Does she have a right to a piece of all his future endeavors--say he creates a phone app and makes a bunch of money off it, etc.?

Please feel free to have one of the legally involved parties log on to ask her own questions. Thank you.

 

[adjusterjack]

OK, thank you. We were told her rental income could not be included, but then she called into question his rental income. Seems like it should be both or neither.

Does she have a right to a piece of all his future endeavors--say he creates a phone app and makes a bunch of money off it, etc.?

She has a right to anything a judge says she has a right to.

 

[LdiJ]

What is the name of your state (only U.S. law)? California

In a divorcing couple, the wife stayed in the jointly owned home and is paying the mortgage. She has tenants in the home and is collecting rental income from them. The husband inherited a house from his mother AFTER the date of separation and is renting it out, receiving income from that rental.

Do either of the spouses have to declare this rental income in the calculations for spousal support?

The previous answers you received need clarification. Gross rental income does NOT count. Net rental income or the actual profit made from rental activities DOES count.

In his case, that would be gross rents minus property taxes, insurance, mortgage interest, repairs, and any other valid expenses incurred in order to produce the income.

In her case it would be the same, but pro-rated between the personal use portion of the property and the rental portion. In her case utilities are likely included therefore those would be pro-rated expenses as well.

They are in CA so if the inherited property was totally paid off and in good condition it might general some truly countable profits, but its not very likely that hers does. Most of the time rental property really does not generate enough actual profit to make much of a difference in any alimony/child support calculation. Sometimes it does, but more often than not it does not.

 

[sook]

Thank you so much. Good info.

 

[sook]

What if he sold it? Would she be entitled to a portion of the proceeds? Again, he inherited this after the divorce was filed.

 

[LdiJ]

What if he sold it? Would she be entitled to a portion of the proceeds? Again, he inherited this after the divorce was filed.

Inheritances are separate property anyway so there is virtually no chance that she would be entitled to any of the proceeds if he sold. However, depending on the length of their marriage its possible that he could have to use some of the proceeds from such a sale to buy her out of other assets.

 

[Silverplum]

Please feel free to have one of the legally involved parties log on to ask her own questions. Thank you.

Needs repetition.
Needs repetition.

 

[Zigner]

Needs repetition.
Needs repetition.

Yes! This thread is a great example of why we (I) don't like dealing with third parties.

 

[Zigner]

The previous answers you received need clarification. Gross rental income does NOT count. Net rental income or the actual profit made from rental activities DOES count.

My initial reply actually covered all of that. The various financial declaration forms will allow for all of this.

(I know of what I speak, having just been [peripherally] involved in filling out financial declarations.)

 

[LdiJ]

My initial reply actually covered all of that. The various financial declaration forms will allow for all of this.

(I know of what I speak, having just been [peripherally] involved in filling out financial declarations.)

I know, but a lot of people honestly think that the full amount of rent received (just like the full amount of self employment received) should be counted for child support/alimony, so I like to clarify that whenever it comes up. I know that YOU know that, but a lot of other people just don't get that.

 

[Zigner]

I know, but a lot of people honestly think that the full amount of rent received (just like the full amount of self employment received) should be counted for child support/alimony, so I like to clarify that whenever it comes up. I know that YOU know that, but a lot of other people just don't get that.

Right, but *my* point is that if the person just follows the instructions for the form(s), it all falls in to place anyway. There's no need to know it ahead of time.

 

[sook]

I know, but a lot of people honestly think that the full amount of rent received (just like the full amount of self employment received) should be counted for child support/alimony, so I like to clarify that whenever it comes up. I know that YOU know that, but a lot of other people just don't get that.

Thank you for the info and clarification. I appreciate it.