When you're self-employed, "income" for child support purposes usually isn't your bank balance or your tax return's bottom line — it's a court's assessment of what you actually have available, after legitimate business expenses but before you start writing off things a court won't recognize.
Gross receipts minus legitimate expenses
Most guideline definitions start from gross business receipts and subtract ordinary, necessary business expenses to reach a net income figure — similar to, but not always identical to, the net profit on a Schedule C. Courts routinely add back deductions they consider personal in substance (a business vehicle used mostly for personal trips, for example), even if the IRS allowed the deduction.
Why self-employed cases get more scrutiny
Because self-employment income is harder to verify than a W-2, these cases often involve more documentation — profit and loss statements, bank records, sometimes a forensic accountant — and courts have more discretion to look past what a tax return shows to what a business owner can actually pay.
Averaging irregular income
Many guidelines average self-employment or commission income over a period (often 2-3 years) rather than using a single year, to smooth out normal business fluctuations, though a court can depart from that if a recent, sustained change (a business closing, a major new contract) makes the average misleading.
FAQ
Can I just use my tax return's net profit figure?
It's a starting point, not the final word — courts commonly adjust it for expenses they don't consider legitimate business costs for support purposes.
What if my income varies a lot year to year?
Ask about averaging — most states have a mechanism for it, though the exact period and method varies. This is a case-specific legal question best raised with a family law attorney.