In a recent case decided by the Western District Court of Appeals the Court found that payment in stock may be included in a parent’s gross income for determining child support when the stock produces dividends, retained earnings, or a capital gain from sale of the stock. Because the parent’s paystubs represented stock dividends, rather than purchases, the court concluded these amounts were income and could be considered part of the parent’s income for child support purposes. Jill Suzanne Heckman v. Daniel James Heckman, II, Missouri Court of Appeals, Western District-WD75676.
The bottom line in this case was that stock options were purchased with funds paid in lieu of salary to the employee. So, while one may try to avoid paying higher child support by receiving stock options instead of a higher salary or bonus this case clearly stands for the proposition that stock options can still be considered income and the receipt of stock options may not necessarily be a way to avoid paying higher child support in the future.