Opinion ID: 1969590
Heading Depth: 1
Heading Rank: 2

Heading: Deduction of Income Tax Deficiency.

Text: In settlement of an income tax obligation arising in 1983, 1984, and 1985, Dale agreed to a compromise requiring him to pay annually to the internal revenue service a percentage of his annual adjusted gross income. He urged that the amount paid under the terms of the settlement should be deducted in arriving at his net income for guideline purposes. Based upon a $50,000 annual adjusted gross income, he urged the amount paid upon the income tax deficiency would be $417 per month. The trial court refused to allow a deduction for the payments of income tax deficiencies of prior years from gross income based on the average income in 1986-1992. To arrive at an appropriate child support award, the court must determine the net monthly incomes of the custodial and noncustodial parents and then apply the guideline chart consistent with the number of children of the parties living in the custodial home. Our guidelines provide the term net monthly income means gross monthly income less deductions for ten identified items, including (1) federal income tax (properly calculated withholding or estimated payments). To achieve fairness and uniformity, the income tax deducted should be a figure that reflects actual ultimate income tax liability. In re Marriage of Miller, 475 N.W.2d 675, 679 (Iowa App.1991). Our guidelines specifically do not allow a deduction for voluntary savings or payment of indebtedness. Although actual payments of child support on prior child support orders are deductible from gross income, current payments on child support arrearages are not. State ex rel. Davis v. Bemer, 497 N.W.2d 881, 882 (Iowa 1993). Likewise, Dale's current payments, required under the 1990 compromise settlement of 1983-1985 income taxes, are not deductible in determining his average net monthly income after 1985.