Opinion ID: 2119975
Heading Depth: 2
Heading Rank: 2

Heading: Net Income

Text: The trial court held that William Pursley's income for the purpose of determining his child support obligation was [his] gross income as defined for Federal Income Tax purposes less Federal Tax, State Tax, FICA Tax, Medicare Tax, and any other payments required to be paid by [William Pursley] to the state or federal governments. The Court of Appeals agreed with the trial court's ruling. But Sharen Pursley argues that it is William Pursley's income minus only deductions from his 401K that will be used for the children's education. We disagree. The Agreement provided that William Pursley's federal income tax returns would be used to determine his income, and then after stating his salary and bonus, it provided that the children shall be entitled to receive 30% of the net proceeds from the said salary and bonus. So logically, William Pursley's income for the purpose of calculating his child support obligation is his salary and bonus as shown on his federal income tax return less deductions therefrom, or in other words, his net income. [36] The trial court ruled that William Pursley is entitled to deduct any required tax payments in calculating his net income, but not any voluntary payments, such as 401K contributions. We find that this is a reasonable interpretation of the parties' Agreement.