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Mother Loses Child Support Appeal Because Reinvested Sale Proceeds are Not Income and Capital Gains From Two Years Earlier are Too Remote

In Patnode v. Urette, 2015 VT 70 (May 8, 2015), the Vermont Supreme Court affirmed a child support order.

Issue: Mother appealed a child support order, arguing that income should be imputed to Father based on the sale of real estate in 2008 and 2010 by a business in which Father has a minority interest.

Holding: The Court rejected Mother’s arguments. It held that capital gains from the 2008 sale were too remote to be considered in a 2010 child support order. It did not reach the question of whether the capital gains, if timely, would be “income” within the statutory definition. It held that the 2010 sale proceeds were not “income” because Father did not receive any distribution that increased the money available for his personal living expenses and, if the family had remained together, there would not have been additional money to enhance the children’s standard of living.” The proceeds were reinvested in the business and used to acquire another property in a like-kind exchange that did not trigger any capital gains.

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