What is Considered Income for Child Support in California?

California has statewide guidelines and Family Code sections that define gross income. California Family Code section 4058 considers gross income that from any source except for child support payments that are actually received or public assistance programs where the eligibility for program assistance is based on need. Some California appellate courts have determined that supplemental Social Security (SSI) benefits are also excluded from income because they are based on public assistance. In addition, some appellate courts have ruled spousal support payments between the same parents must also be excluded.

So what is considered income for child support in California?

Orange County Child Support Lawyers

California Child Support Laws
What Is Income For Support Purposes?

By statute, income includes salaries and wages as well as commissions, bonuses, rents (which are typically from rental property), dividends, pensions, interest income, income from a trust or annuity (unless the annuity is connected to a non-income source such as personal injury proceeds), benefits paid as a result of a workers compensation case, unemployment insurance, disability insurance benefits (especially when it is designed to replace income), Social Security benefits and alimony that is received from an unrelated case to the parent that seeks child support.

For Orange County business owners or executives going through a divorce, their income is typically the gross revenues of the business minus business expenses.

Courts also have the discretion to include as income those benefits (whether those are employment or self-employment) that reduce living expenses. This reduction of the expenses can include rent-free housing, meal allowances and just about anything that reduces the living expenses of an individual and for which individual would normally have to pay but receives as a benefit of employment.

More recent case law (a case called In re Marriage of Alter) has also stated that recurring monetary gifts from a person’s parents can also be considered income regardless of whether or not the gifts are considered income for federal tax purposes.

For those who hold stock options, there are cases that have determined unexercised stock options can be considered income.

For service members, the basic allowance for housing and subsistence have been considered income.

In Orange County, like other family courts, the process of determining income starts with the filing of a divorce or paternity petition. Child support is probably the most often litigated issue in a divorce or paternity case. Child support is so often disputed that Orange County has its own Department of Child Support Services, which is a government agency designed to establish and enforce child support orders for men and women who cannot afford an attorney or do not wish to retain one. While the Department’s efficiency compared to that of an experienced private attorney is reasonably questionable, the Department does serve a function for those unable to pay for private counsel. This Department of Child Support Services also collects child support for people who are on government aid but reimburses the county or state for that aid.

Unless child support is not disputed or the parents’ incomes are easy to figure out because they are both W2 employees, it is common for there to be some investigation or discovery (formal written requests for information during the divorce or paternity case) during the litigation process.

A question that often comes up is what isn’t income for California child support purposes?

This list is not intended to be exhaustive but does highlight some of the more common types of money received that the Orange County family court will not input into the California guideline formula when determining child support.

Student loans that are used for books and tuition are not considered income for child support purposes.

The principle of life insurance death benefits are not considered income. However any interest that is obtained from it or income received from it can be considered child support.

Future income that is speculative is not considered income for child support purposes. For there to be a consideration of future income, there generally has to be some evidence that the future income is consistent with past income.

Stock is not considered income when it cannot be liquidated or is received in connection with the sale of the business. This is not a hard and fast rule and there are exceptions as the type of stock, its marketability and the potential rate of return from it can be considered by the court.

Under most circumstances, equity in a parent’s residence is not considered income. The two cases that have come down in California Courts on this issue as of the date of this article are Marriage of Henry in 2005 and Marriage of Williams in 2007. A careful reading of these decisions is needed to understand this rule and the potential, limited exceptions to it.

Personal injury proceeds are generally not considered income unless the personal injury proceeds were specifically earmarked as compensation for lost income. It is rare for that to happen in a personal injury case. Typically, the settlement agreement does not distinguish between income versus nonincome or what specifically the personal injury damages were designed to compensate. Such damages are traditionally awarded in a settlement as a lump sum without designation.

Gifts of a nonmonetary nature are generally not considered income. It is not unusual for a parent to provide an adult child with a gift whether that is small items such as household items or something as large as a car. In such situation the value of that gift is generally not considered income for child support purposes.

The determination of child support and what is and is not income in a California child support case can be complicated and in any case where one or both parents are some employed and have a non-W-2 income structure, the services of an experienced Orange County lawyer who is knowledgeable on child support issues can be very helpful.

If you have a Orange County child support matter, whether you are the one facing a child support award against you or seeking child support, you owe it to yourself to get a consultation from our experienced Orange County child support lawyers. We will help direct you toward the right path and will use our experience and knowledge to assist you in ensuring that you receive a fair child support award or, if you are the paying parent, that you are not ordered to pay child support inconsistent with your income and ability to pay.

Have more child support questions that you want to research? Visit our Orange County child support FAQ page.


  1. Michael says

    Hi there,
    an attorney looked over my pay stub, and informed me that i was being given a huge break from the judge. she calculated my income that is used for child support purposes by adding in what the county pays into a retirement system. from what i understand i pay into the system, and the county funds the system for all the employees. Well these benefits that are for all employees to receive throughout there retirement, are listed on my pay stub.. an attorney is arguing that i pay taxes on that benefit contributed by the county. I argue that it is not part of my income. the county funds that amount for all employees, but is not guaranteed to employee. for example, i were to pass, my benefit does not continue on to any heir of mine. can you possibly clear this up. thank you very much

    • B. Robert Farzad says

      Michael, we don’t give legal advice in a comment to an article. Please consult with your current attorney with any questions.

  2. Lori says

    I share joint legal and joint physical custody with my ex husband. We also have a 50/50 visitation for our son. He stays with me a week at a time and dad a week at a time. I pay monthly child support and was ordered to pay for health insurance. I also have the higher adjusted gross income. There is no order regarding who can claim my child for tax purposes. Who has the legal right for the deduction?

    • says

      That’s a shame your order doesn’t cover this issue because it should. Since we don’t give advice in a comment to an article, if your matter is in Orange County or Los Angeles, and want to discuss this issue with us, we can offer you an affordable strategy meeting.

  3. Armin says

    Hello Robert, you stated in your web page that “Equity in the home is not considered income.” I am in a case right now where the judge stated I could sell my house (I’ve owned it for 20 years) and use its equity to pay child support.

    Is there a specific family code or case law that states “Equity in the home is not considered income.”? I am not looking for an advice, but a link or reference to this law.
    Thank you,

    • B. Robert Farzad says

      Armin, the case law on this issue can get complex. Please ensure you have an experienced CA family law attorney representing you. Two cases that have come down on this issue that I recall are the appellate decisions of Marriage of Henry from 2005 and Marriage of Williams from 2007. This may provide you with a starting point. Whether or not these cases do or do not apply to you is not something we can tell you as we cannot give you any legal advice. Good luck.

  4. Kelly says

    I recently went to court for child support. My income was calculated wrong and my child support payments are too high. I won’t be left with enough money to pay rent and no money to pay utilities, when my checks start being garnished. Can I file for modification to get my actual income taken into consideration?

    • B. Robert Farzad says

      I don’t understand how your actual income wasn’t taken into consideration the first time. In California, both parents are required to submit an income and expense declaration and proof of their income (such as paystubs). Kelly, I can’t answer your question about a modification because I would first have to determine if you have proper legal grounds to seek one. That would require me to review your file. If your case is in Orange County, you can contact us to set a time to meet. We do offer reasonable fees.

  5. Manuel says

    I live in Bakersfield, Ca. I am currently married do they count my wife’s income too to determine how much money I will have to pay in child support?

  6. Carlos says

    Hi, I am in Los Angeles fighting a child support modification order. I have been paying as agreed however, my ex-wife is now disabled and is asking for more money. My question is this; She rents a 5 bedroom home, occupies 2 bedrooms, and rents 3 remaining bedrooms to friends and strangers. Is this considered income for her? Thanks.

    • B. Robert Farzad says

      Hi Carlos. Smart question but I would need more facts that what you provided to answer your question. Since your matter is in L.A. please consult with an attorney there since our firm is not taking on any new matters outside of Orange County.

Leave A Comment

Comments are displayed publically and are not confidential, including the name you enter. Comments do not form any attorney-client relationship.