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North Dakota Child Support Definitions

Definitions.

1. "Child" means any child, by birth or adoption, to whom a parent owes a duty of support.

2. "Child living with the obligor" means the obligor’s child who lives with the obligor most of the year.

3. "Children’s benefits" means a payment, to or on behalf of a child of the person whose income is being determined, made by a government, insurance company, trust, pension fund, or similar entity, derivative of the parent’s benefits or a result of the relationship of parent and child between such person and such child. Children’s benefits do not mean benefits received from means tested public assistance programs.

4. "Custodial parent" means a parent who acts as the primary caregiver on a regular basis for a proportion of time greater than the obligor, regardless of custody descriptions such as "shared" or "joint" custody given in relevant judgments, decrees, or orders.

5. "Gross income" means income from any source, in any form, but does not mean benefits received from means tested public assistance programs such as aid to families with dependent children, supplemental security income, and food stamps. Gross income includes salaries, wages, overtime wages, commissions, bonuses, deferred income, dividends, severance pay, pensions, interest, trust income, annuities income, capital gains, social security benefits, workers’ compensation benefits, unemployment insurance benefits, retirement benefits, veterans’ benefits (including gratuitous benefits), gifts and prizes to the extent each exceeds one thousand dollars in value, spousal support payments received, cash value of in-kind income received on a regular basis, children’s benefits, income imputed based upon earning capacity, military subsistence payments, and net income from self-employment.

6. "In-kind income" means the receipt of any valuable right, property or property interest, other than money or money’s worth, including forgiveness of debt (other than through bankruptcy), use of property, including living quarters at no charge or less than the customary charge, and the use of consumable property at no charge or less than the customary charge.

7. "Net income" means total gross monthly income less:

a. Federal income tax obligation based on application of standard deductions and tax tables;

b. State income tax obligation based on application of standard deductions and tax tables;

c. Federal Insurance Contributions Act (FICA) and medicare deductions or obligations;

d. A portion of premium payments, made by the person whose income is being determined, for health insurance policies or health service contracts, intended to afford coverage for the child or children for whom support is being sought, determined by dividing the payment by the total number of persons covered and multiplying the result times the number of such children;

e. Payments made on actual medical expenses of the child or children for whom support is being sought;

f. Union dues where required as a condition of employment;

g. Employee retirement contributions, deducted from the employee’s compensation, other than FICA, where required as a condition of employment; and

h. Employee expenses for special equipment or clothing required as a condition of employment or for lodging expenses incurred when engaged in travel required as a condition of employment (limited to thirty dollars per night or actual lodging costs, whichever is less), incurred on a regular basis, but not reimbursed by the employer.

8. "Net income from self-employment" means gross income of any organization or entity which employs the obligor, but which the obligor is to a significant extent able to control, less actual expenditures attributable to the cost of producing income to that organization or entity.

9. "Obligee" includes, for purposes of this chapter, an obligee as defined in subsection 8 of North Dakota Century Code section 14-09-09.10 and a person who is alleged to be owed a duty of support.

10. "Obligor" includes, for purposes of this chapter, an obligor as defined in subsection 9 of North Dakota Century Code section 14-09-09.10 and a person who is alleged to owe a duty of support.

11. "Split custody" means a situation where the parents have more than one child in common, and where each parent has sole custody of at least one child.

Minimum support level.

A support obligation should be established in each case where the obligor has any income. Even though the obligor’s payment is far from sufficient
to meet the child’s needs, considerations of policy required that
all parents understand the parental duty to support children to
the extent of the parent’s ability. Equally important considerations
of policy require the fostering of relationships between parents and children which may arise out of the recognition of parental duty.

Determination of net income from self-employment.

1. Expenses attributable to the cost of producing income vary from business to business. Deducting expenses from the gross income of the business determines the adjusted gross income, according to internal revenue service terminology. If the latest tax return is not available or does not reasonably reflect the income from the business, a profit and loss statement which
will more accurately reflect the current status of the business must be used.

2. After adjusted gross income from self-employment is determined, all business expenses allowed for taxation purposes, but which do not require actual expenditures, such as depreciation, must be added to determine
net income from self-employment. Business costs actually incurred and paid, but not expensed for internal revenue service purposes, such as principal payments on business loans (to the extent there is a net reduction in total principal obligations incurred in purchasing depreciable assets), may be deducted to determine net income from self-employment.

3. Farm businesses experience significant changes in production and income over time. To the extent that information is reasonably available, the average of the most recent five years of farm operations, if under-taken
on a substantially similar scale, should be used to determine farm income.

4. Land costs are a significant part of farm expenses. Because farmlands are used both for the production of income and for investment purposes, for the purpose of making determinations under this section, deduction of
business costs relating to the purchase of land is limited to the lesser of:

a. The fair rental value of the land being pur-chased;
or
b. The total principal and interest payments actually made toward the purchase of the land.