EPISODE 6 – 4/29/22 – David Consigli, CPA, ABV, Partner at FAZ CPAs, in Boston, MA
Business income is very complex especially when we are talking about a small business owned by an individual. Before we can even start talking about any type of support, we really need to determine what income we are going to use to do the calculations. Depending on the type of entity – Schedule C, S-Corp or Partnership – the owner’s income is being reported differently. What income do we use? What deductions get added back to increase available income for support? Some owners runs personal expenses through a business which in turn reduces their taxable income, so this needs to be explored in a divorce so the right income can be used in the support calculations. This is an important episode when you or your spouse are self-employed or have a family-owned business.