## Facts

- Christina C. Carolan and David A. Bell, unmarried parents, had a seven-year-old son.
- Carolan worked as a dental assistant earning $13.50 per hour, generally working Monday through Thursday for about 33–35 hours per week because the dental office was closed on Fridays.
- Carolan’s employer paid the cost of Carolan’s health-insurance coverage, but Carolan did not provide the premium amount at the child-support hearing.
- Carolan rented a small home owned by her parents for $1,000 per month; Carolan’s parents had previously rented the same property to another tenant for $1,300 per month.
- In a parental rights action, the District Court granted the parties shared parental rights and responsibilities and later held a separate hearing to determine child support.
- At the support hearing, Bell urged the court to add to Carolan’s “annual gross income” (1) the $300 monthly difference between Carolan’s rent and the prior tenant’s rent, (2) the value of the employer-paid health-insurance premiums, and (3) additional wages on the theory that Carolan was voluntarily underemployed because she did not work a 40-hour week.
- The District Court accepted these imputed-income components in calculating child support.
- Carolan appealed, challenging the child-support calculation and the imputed-income determinations.

## Issues

1. Did the District Court err by treating the estimated value of Carolan’s below-market rent from her parents (based on the prior tenant’s rent) as part of her “annual gross income” for child-support purposes?
2. Did the District Court err by including, as gross income, the value of health-insurance premiums paid by Carolan’s employer, and by estimating that value when the exact cost was not in evidence?
3. Did the District Court err by imputing additional wages to Carolan on a finding of voluntary underemployment when her job’s hours were limited by the employer’s schedule (office closed on Fridays)?

## Decision

- The Supreme Judicial Court of Maine affirmed in part and vacated in part the child-support judgment.
- The court held that the District Court erred in imputing as income an estimate of the additional economic value of Carolan’s below-market rent from her parents.
- The court held that the District Court properly included employer-paid health-insurance premiums as part of Carolan’s gross income and did not abuse its discretion by using a reasonable proxy to estimate the premium cost when Carolan did not supply exact figures.
- The court held that the District Court erred in imputing additional wages based on a 40-hour workweek because the record did not support a finding that Carolan was voluntarily underemployed when her employer’s office was closed on Fridays and the extra hours were not shown to be available.
- The court vacated the child-support award and remanded for recalculation consistent with its opinion.

## Legal Principles

- Under Maine’s child-support statutes, the parties’ annual gross incomes are the starting point for calculating support under the guidelines and the Child Support Table. See 19-A M.R.S. §§ 2001(5), 2006, 2011.
- Employer-provided, noncash compensation that reduces a parent’s personal expenses, such as employer-paid health-insurance premiums, may be included in gross income for child-support calculations.
- When the precise amount of an includable employment benefit is not available, the trial court may assign a reasonable value based on the evidence presented, and the valuation decision is reviewed for abuse of discretion.
- A discretionary financial benefit provided by family members, such as a below-market rent arrangement that can change at any time, is not properly treated as ongoing gross income merely by comparing it to a prior tenant’s rent.
- Voluntary underemployment is a question of fact reviewed for clear error; imputing income based on underemployment is reviewed for abuse of discretion and requires record support that additional earnings are reasonably obtainable, not merely a comparison to a 40-hour week.

## Conclusion

Carolan v. Bell holds that a trial court may count employer-paid health-insurance premiums as gross income in setting child support and may reasonably estimate their value when exact figures are unavailable, but it may not inflate income by imputing a rent “discount” from a parent’s family or by assuming extra wages from hours that the parent’s job does not make available; the Law Court therefore vacated the support award and remanded for recalculation.


Carolan v. Bell, 916 A.2d 945 (2007)