Gross income includes, but is not limited to, salaries, wages, commissions, bonuses, dividends, severance pay, pensions, interest, trust income, recurring monetary gifts, annuities, capital gains, social security benefits (in some circumstances), worker’s compensation benefits, allowances for housing and subsistence from military pay and benefits (BAH and BAS), unemployment insurance benefits, disability insurance benefits, and spousal support received from a pre-existing spousal support obligation.1

Note that gifts and lottery proceeds are not included as “gross income.” Previously, lottery proceeds were specifically excluded from gross income. However, the law has been amended and lottery proceeds are no longer specifically excluded. Thus, such proceeds may be counted as income. Depending upon the size and character of gifts, they may be considered by the court under La. R.S. 9:315.1 as a basis for a deviation from the guidelines.

Gross income also includes expense reimbursements or in-kind payments received by a parent in the course of employment, self-employment, or operation of a business, if these reimbursements or payments are significant and reduce the parent’s personal living expenses.2  These types of payments may include, but are not limited to a company car, free housing, or reimbursed meals. The court may also consider as income the benefits a party derives from expense sharing or other sources.3  In computing expense sharing with another spouse, it is inappropriate to consider the income of another spouse, except to the extent that such income is used directly to reduce the costs of a party’s actual expenses.4

• 1La. R.S. 9:315(C)(3).
• 2Id.
• 3La. R.S. 9:315(C)(5)(c).
• 4Id.

Gross income also includes gross receipts minus ordinary and necessary expenses required to produce income from self-employment, rent, royalties, proprietorship of a business, joint ownership, partnership, or closely held corporation.1  Ordinary and necessary expenses do not include amounts allowable by the IRS for the accelerated component of depreciation expenses or investment tax credits or any other business expenses determined by the court to be inappropriate for determining gross income for the purposes of calculating child support.2

It may be difficult to imagine how this works in practice. Proving income for self-employed persons is difficult without the necessary documentation. Thus, the first course of action is to request (informally or through discovery) tax returns, profit-and-loss statements, or other documentation. To be excluded from income, the expenses must be “ordinary and necessary” in the course of business, and they must be required to produce that income; they must not be personal. Further, the burden is on the self-employed person to prove that the expenses are necessary to produce income.3  If the defendant is alleging expenses associated with starting up a company, the defendant must have documentary proof; something more than testimony is required.4  Additionally, La. R.S. 9:315.1.1 addresses redirected income, payments made to the obligor from a company in which the obligor has an ownership interest, and deferred income. Most cases do not have these issues, but you should be familiar with this article, just in case.

• 1La. R.S. 9:315(C)(3)(c).
• 2Id.
• 3Hensgens v. Hensgens, 2019-485 (La. App. 3 Cir. 12/18/19), 287 So. 3d 795.
• 4Bailey v. Bailey, 2019-644 (La. App. 3 Cir. 3/11/20), 297 So. 3d 58.

Gross income does not include child support received by the parent, benefits received from public assistance programs including FITAP, SSI, food stamps, and disaster assistance benefits, per diem allowances which are not subject to federal income taxation, and extraordinary over-time or income attributed to seasonal work regardless of the percentage of gross income when, in the court’s discretion, inclusion would be inequitable.1

• 1La. R.S. 9:315(C)(3)(d).