A recent Supreme Court opinion has explained the impact of employer fringe benefits on a child support calculation. On November 29, 2006, the New Hampshire Supreme Court issued the opinion in the case called In the Matter of Susan and Nathan Clark.

In Clark , the husband was ordered to pay child support to the wife. The wife discovered, following the separation, the husband was living in his employer's home and paying only nominal rent. He was also permitted to use a company vehicle for his personal use and received other benefits. The wife, in an action to increase child support, argued that these benefits were income and should therefore be used in the child support calculation.

The Supreme Court held that the fringe benefits received by the husband are not income for child support purposes. The Supreme Court explained that income is generally defined as something that is payable in money and something the recipient has a legal right to obtain. Thus, gifts are not income for child support purposes because the recipient cannot legally compel the giver to make the gift. In the Clark case, the Supreme Court held that these benefits are not convertible to cash. The Court refused to follow decisions from other states which held that employer fringe benefits could be converted to a cash equivalent for child support purposes.

The Supreme Court cautioned, however, that merely because employer fringe benefits are not income for child support calculations, does not end the inquiry. Under New Hampshire law, the trial court has discretion to deviate from the child support guidelines (a child support amount calculated by a mathematical formula based upon the parties' gross monthly incomes) if it finds special circumstances make such a deviation appropriate. One such recognized reason to deviate from the child support guidelines would be a finding that the receipt of the fringe benefits would make a guidelines support order unreasonably low.

One could imagine a scenario where an employee receives nominal earnings but has much of his day to day expenses paid for by the employer, such as housing, food, vehicle, et cetera. If the parent with primary residential responsibility does not receive such benefits from his/her employer, he/she would have very little income after paying his/her own living expenses to help care for the children. Therefore, under such a scenario, the court could order the other parent to pay more child support than what was called for under the guidelines.

Andrew J. Piela is an associate attorney at Hamblett & Kerrigan, P.A. His legal practice includes civil litigation, family law, land use litigation and probate. You can reach Attorney Piela by e-mail at: apiela@hamker.com

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