Could someone help me understand soc's reponse to

[Stirling]

"and yes, sales receipts came in during January through April."

These are the records that you can use to try and support your case.  


"I think a person with no business experience would see that as a reasonable way to calculate. I must be wrong though, because Soc and the attorney seem to think that it will be annualized starting April."

Again I would ask your attorney to explain to you why the annualization should start in April.  Perhaps he doesn't understand the fact apttern correctly.  That the distribution income your husband received in April relates to work/services that he performed in January through April.  That April draw represents several months worth of income based on several months of actual work done.  Not to include Jan. through Apr. in the annualization assumes that your husband only worked and earned income in one month.  In a way the April distribution is kind of like deffered compensation.  

You may want to try and explain it to your attorney using an example that includes the attorney.  Such as:

Mr. attorney you are a partner in a PC and you take your compensation in the form of a draw/distribution as cash flow allows.  You work and collect payments for your work for several months.  Unfortunately, the cash flow needs of the business don't allow you to take a draw/distribution for several months.  You wife has decided to divorce you and wants to calculated CS starting with the first month you had a draw/distribution and not allow in the CS calculation the months where you didn't receive a draw/distribution.  

[4honor]

One could hypothetically get the LLC to write him a check for $18.60 and dated in January after the first week of business. Use a check that is numbered later than the others (as if the check were written on the wrong book of checks.) So that it shows income in January.

Cash the check with some other checks that come in so that it looks as if the check was made out and available/paid in the month of January, but forgotten until recently.

Submit. Enjoy!

[Ref]

Court was actually yesterday. It went great. DH's attorney only requested a reduction for the time her was unemployed stating that he is back on his feet now and making the same as before. Dh was awarded the reduction of about $2500 to be spread over 30 months and very little review was done about his current income.

BM may want to go to court seperately for the increase, but she will have some serious legal debt to get through first.

I posted on the second families board the rest of it.

Thanks everyone!!!
Ref

[mistoffolees]

That's the difference between an accountant and a business manager.

As a business manager, I'd tend to downplay the first few months. In almost any kind of business, it takes months to generate business and there's absolutely no reason to think that the first few months are representative. Furthermore, expenses are much higher at the beginning.

The judge's goal is to try to predict what future income will look like. The judge has apparently decided that the first few months of the business are not representative and therefore shouldn't be counted. Your own post implies that this is correct.

It would be impossible for me to make a definiitive statement without ALL the details, but what they're suggesting just plain doesn't sound unreasonable to me.

[Ref]

and was able to see through ex's attorney's concept of what the numbers were. He actually did have great business sense and understood the ups and downs of a first year business better than what everyone anticipated.

It was a great victory for us and I think we will be reveling in it for quite some time.

PS Don't underestimate a public accountant's ability to understand business. Eventhough we don't see the day-to-day, we are able to get a good idea of what happens in dozens of different types of companies a year.

[Jade]

>DH actually file for a decrease after he lost his job. He had
>no idea that this opportuntity would come about.
>
>Court is in less than 2 weeks. CS runs for less than 3 years
>from now.
>
>Any suggestions from the peanut gallery?
>
>Ref


In my state, child support would not be lowered because you lost your job.  What would happen is that the judge would only order a certain amount of the child support to be paid (with the remainder becoming arrears) until he found a job.  He would have to be show that there are literally no jobs left in his field.  This is what my attorney (who is a court approved mediator as well) told me when I asked.

Hopefully, your dh will be able to find a job soon.

[Jade]

>I think Soc. is trying to tell you that you need to get
>creative in your approach and arguments in order to support
>your case.  
>
>If I understand your situation correctly you started a new
>business at the beginning of the year which initially
>generated significant income.  Currently, the business is not
>generating as much income.  Your concern is that a pending CS
>modification will result in an over-stated CS award based on
>the beginning of the year profits.
>
>
>I don't know the details of your business, but here are a few
>arguments that you could use if the fact pattern is there to
>support your case.  First is what Soc. suggested, that you
>gather support to show that your business is cyclical.  That
>given the nature of the business you make more money in the
>beginning of the year and less at the end of the year.
>
>You could also try to make a case that the beginning of the
>year profits were extraordinary and non-recurring in nature.
>That it was a one time event and the end of the year profits
>is a more realistic expectation of what your future income
>will be.
>
>As Soc said you will probably need some kind of expert to
>testify in order for your arguments to have credibility with
>the judge.  
>
>I agree with Soc when he said that judges/attorney don't like
>math.  This is why the will give credibility to an expert
>financial witness.  It is also why a judge may lean towards
>just annualizing your year to date income for the year and use
>that in the CS calculation since it is simple to do and is
>based on a lodgic the judge can understand.  Again you have
>the burdan of proof to show that annualizing your year to date
>income will distort the CS calculations.  You need to prove
>what a realistic expectation of your future recurring income
>will be.
>
>If your new business is so volitile that a reasonable
>projection of your future recurring income is not possible
>then you should consider, as Soc. suggested, to cut a deal
>with your Ex which deviates from the guidelines.  Soc.
>suggested to base CS as a specific percentage of your actual
>earnings.  Again get creative here in trying to come up with a
>compromise that everyone can live with.
>
>Good Luck!!!

Just because a business is cyclical doesn't mean that the all of the income won't be used.  What can be done to help ease the financial obligation during the low times is to determine what child support would be based on the income for the entire year and then structure the payments to be higher during the high times and lower during the low times.  This is going to require co-operation with the custodial parent.