Self-Employment, Cash Payments, Lottery Winnings - Proving Income Without a W-2 / by Cassandra Hearn

Child support and spousal support are central issues in many divorces. California bases both types of support on a variety of factors, and the two types of support have very different requirements and qualifications. However, one issue they have in common is that it is necessary to accurately determine the income of each parent or spouse in order to create an accurate support order. Where a spouse has a regular income and receives a W-2, proving income should be direct and clear; however, proving income can be complicated for a non-traditional earner who is self-employed, takes cash payments, receives trust disbursements, has lottery winnings, or otherwise has some type of income that does not generate a W-2. The first step to determining what is an accurate income is to review the “Income and Expense Declaration.”  

When one party requests spousal or child support, each party must then file an income and expense declaration with the court. You should carefully review the disclosures made on the statement filed by your spouse and look for discrepancies, or look for clues that will help you focus your requests for further information. Most cases involve a process called "discovery."  Discovery is a process by which your attorney can require the other party to produce certain documents. These documents include proof of income, including 1099s, financial statements from income-generating investment accounts, annuity statements, tax returns, or any other document that your lawyer believes may lead to relevant evidence. This is the most straight-forward way to get proof of income that is not on a W-2. If your former spouse or partner runs his or her own business, your attorney will also likely need to obtain copies of business records and financial statements to the business to ensure that your spouse is not hiding income within the business. If the documents provided are unclear about your spouse's income, it may become necessary to hire a forensic accountant to help understand what your spouse's income really is.

If these methods fail, you can also produce proof of your spouse's lifestyle. For example, if your spouse is alleging that she is on the brink of poverty, but lives in a large house and takes lavish vacations, the court may impute income based on lifestyle choices even when earned income is unclear. If this is the case, you may be able to ask the court to impute an income to your former spouse or partner.

We have extensive experience with helping our clients with setting accurate spousal and child support amounts in their cases. Call us today at 619-800-0384 for a consultation and we can discuss child support and your case.