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South Dakota Child Support Definitions

Determination of parents’ monthly net income - Sources of income.

The monthly net income of each parent shall be determined by his gross income less allowable deductions, as set forth herein. The monthly gross income of each parent includes amounts received from the following sources:

(1) Compensation paid to an employee for personal services, whether salary, wages, commissions, bonus or otherwise designated;

(2) Self-employment income including gain, profit or loss from a business, farm or profession;

(3) Periodic payments from pensions or retirement programs, including social security or veteran’s benefits, disability payments or insurance contracts;

(4) Interest, dividends, rentals, royalties or other gain derived from investment of capital assets;

(5) Gain or loss from the sale, trade or conversion of capital assets;

(6) Unemployment insurance benefits; and

(7) Worker’s compensation benefits. If the income of the parents is derived from seasonal employment, or received in payments other than regular, recurring payments, such income shall be annualized to determine a
monthly average income.

Rebuttable presumption of employment at minimum wage.

Except in cases of physical or mental disability, it shall be presumed for the purposes of determination of child support that a parent is capable of being employed at the minimum wage and his child support obligation shall be computed at a rate not less than full-time employment at the state minimum wage. Evidence to rebut this presumption may be presented by either parent.

Assets considered when income insufficient.
If a child’s needs are not being met through the income of the parents, assets shall be considered. If the parents have savings, life insurance or other assets in amounts unrelated to income, these holdings shall be considered. The parents’ ability to borrow may be used to determine financial ability.

Profits or losses shown on federal income tax schedules as gross income - Court allowance of deduction.

Gross income from a business, profession, farming, rentals, royalties, estates, trusts or other sources, are the net profits or gain, or net losses shown on any or all schedules filed as part of the parents’ federal income tax returns or as part of any federal income tax returns for any business with which he is associated, except that the court may allow or disallow deductions for federal income taxation purposes which do not require the expenditure of cash, including, but not limited to, depreciation or depletion allowances, and may further consider the extent to which household expenses, automobile expenses, and related items are deductible or partially deductible for income tax purposes. In the event a court disallows depreciation, it may consider necessary capital expenditures which enhance the parent’s current income for child support purposes.

Allowable deductions from monthly gross income.

Deductions from monthly gross income shall be allowed as follows:

(1) Income taxes withheld figured on the basis of two dependent exemptions for a single taxpayer paid monthly rather than actual amount withheld;

(2) Estimated income taxes payable, prorated monthly;

Abatement of portion of child support.

Unless the parties otherwise agree and the agreement is approved by the court, the court may, if deemed appropriate under the circumstances, order an abatement of not less than thirty- eight percent nor more than sixty-six percent of the child support if:

(1) A child spends ten or more days in a month with the obligor;

(2) The number of days of visitation and the abatement percentage or amount are specified in the court order; and

(3) The visitation is actually exercised. The court shall allow the abatement to the obligor in the month in which the visitation is exercised, unless otherwise ordered.

Allocation of travel costs by court.

If travel costs are substantial due to the distance between the parents, the court may order the allocation of such costs, taking into consideration the circumstances of the respective parties as well as which parent moved and the reason that the move was made.

Insurance - Computation of costs - Apportioned between parents.

The court may enter an order for health and dental insurance coverage. Medical insurance shall be provided for the benefit of the minor child whenever practical. The cost of the insurance attributable to the child shall be determined by dividing the out-of-pocket cost of the insurance to the parent by the number of individuals insured thereunder. However, if information is provided at the time of hearing regarding the actual additional costs for the child’s share of the insurance, that figure shall be used. The cost so computed shall be apportioned between the parents on the basis of income or income imputed. If one parent pays the entire amount, that parent shall either be reimbursed by the other parent for that parent’s portion of the payment or shall receive a credit against his or her support obligation,
whichever is appropriate. Any additional, reasonable medical costs, including optometric, dental or orthodontic, counseling or other health care costs for each minor child which exceed two hundred fifty dollars in any year and are not covered by insurance, shall be apportioned between the parents in proportion to the support obligation of each parent.

Order allocating child care expenses.

The court may enter an order allocating the reasonable child care expenses for the child, which are due to employment of either parent, job search of either parent, or the training or education of either parent necessary to obtain a job or enhance earning potential. The court may consider whether the federal child care tax credit for such minor child is available as a benefit to the custodial parent. If the federal child care tax credit is available to the custodial parent, it shall be calculated at twenty- five percent of the eligible expense.