Parties had divorced. They were back in court. Wife was to pay child support. She had a personal injury case settlement. The Court was deciding how much of it should go toward child support from her.
She had received a net amount of $158,972.77. She testified that the money was for her pain and suffering. She testified that it was not from loss of income. At the time of the hearing, she had spent all of the money from the personal injury settlement. She claimed that there was nothing left to pay child support from.
The Trial Court determined that the settlement was income only to the extent it was attributable to lost earnings. Any other portion of the settlement was off limits to child support from her. Based on the evidence presented, the court concluded $2430 of the settlement was attributable to lost earnings. This portion was income for child support purposes.
The court ordered Wife to pay 20% of the $2430 as part of her child support arrearage. Husband appealed.
The remaining $156,542.77 ostensibly relate to damages for future medical expenses and care, pain and suffering, and disability.
A 1996 case stated that the amount of a personal injury settlement attributable to lost earnings is income for child support purposes.
However, a 2004 case revised that. It set forth an expansive definition of income. This definition which would include the entirety of the net proceeds from a personal injury settlement as those proceeds amount to a gain to the recipient.
The Appellate Court found that the non-income portion of these damages amounts to a financial benefit to the receiving parent. It has a positive impact on the parent’s ability to support his or her children. The Appellate Court held the net proceeds from a personal injury settlement attributable to damages for pain and suffering and disability is income for child support purposes. It does not include the portion for future medical expenses and care.
In re Marriage of Plowman, 2018 IL App (4th) 170665
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