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Understanding earning potential and underemployment

On Behalf of | Aug 5, 2024 | Divorce |

In Ohio, among the factors used to determine alimony (spousal support) are not just the income but the earning potential of both spouses. Earning potential, which is sometimes referred to as “imputed income,” is the amount of money a person should be able to earn given their line of work, experience, education, skills and the current job market.

If the lesser-earning party has been in and out of the job market over the years or let their career take a back seat to family obligations, it may take them some time to reach the earning potential they would have if they hadn’t had those obligations. They may need to acquire some new skills and additional education and experience to become self-supporting.

If they don’t do that after a reasonable amount of time – assuming there’s not a good reason, like a health issue – the other party may still be able to lower or even gradually end their alimony payments. A judge would consider whether or not the recipient party is choosing to be underemployed to keep receiving their support payments. Another name for this is “sandbagging.”

Either side can be guilty of remaining underemployed

It’s not just the recipient party who can be guilty of sandbagging. Sometimes, those paying alimony will intentionally pass up a promotion or an additional project if it means they’ll have to pay their ex more money. That may sound vengeful and self-defeating, but it happens.

Note that this can also happen with child support. It can be a much more serious matter if a parent isn’t providing financially for their child to the extent that they’re able.

If either party believes their ex is intentionally not reaching their earning potential, or at least not making an effort to do so, they can take the matter to court. It’s necessary to have evidence and to present a strong case. Whichever side of the support equation you’re on, if you believe that your ex’s actual income isn’t close to their imputed income, it’s smart to get legal guidance to determine how best to deal with the matter and protect your financial well-being.