Depreciation and Child Support: What Attorneys Should Know

Ever heard of someone buying equipment to reduce their income tax?

Well, they do it for child support, too!

Here’s something many don’t realize—many states do not consider depreciation when calculating income for child support purposes.

Think about that for a moment.

Take Missouri, for example. I was just reviewing the state’s child support guidelines, and they explicitly state that depreciation (and other non-cash reductions of gross receipts) may be excluded when calculating income for child support purposes.

Imagine this scenario: A small business owner reports a net income of $1,200, which includes a $65,000 depreciation expense for a new truck. Now, if that $65,000 were added back into the income calculation, the child support obligation could change drastically.

For attorneys representing clients in cases involving small business owners, scrutinizing these non-cash deductions isn’t just important—it can be a game-changer.

Don’t overlook how depreciation can significantly alter the financial picture and impact the support your client or their children receive.

If you have questions or you’d like to know if it’s time to consider a forensic investigation in your case, we’re here to help.