An Ostler/Smith or Smith/Ostler Order is an additional child support or spousal support order that accounts for when the income of one or both parties fluctuates depending on bonuses, overtime, commissions, etc. Family Code Section 4058 details many items considered a person’s annual gross income, including but not limited to “commissions, salaries, royalties, wages, bonuses, and rent.”
For the Court to account for fluctuating income, it will use the Ostler/Smith Order, which is often in the form of a chart. When the Court orders base child or spousal support, the Court will also refer the parties to a bonus or overtime chart that details the additional fluctuating income above the parties’ set wages. This chart provides for a specific percentage of the bonuses, commissions, etc., to be paid as additional support, which is dependent upon the additional income amount.
For example, Mother’s salary is $5,000.00 per month or $60,000.00 per year. She pays the Other Parent $500 a month for spousal support. However, Mother receives an annual bonus depending on her sales. On December 31, 2021, Mother received a $5,000 annual bonus for 2021 sales. When Mother checks the chart, she sees that based on the bonus amount, the percentage is 45.84%, equating to $2,292 of additional spousal support. Thus, Mother will pay $500.00 in base monthly spousal support and a one-time payment of $2,292 for the bonus income. If the commissions/bonuses are monthly, there will be monthly additional support payments made instead of a one-time payment for an annual bonus.
Having an Ostler/Smith Order helps the Court, and the parties, handle fluctuating income. This order also helps reduce litigation as the parties can consult the chart to determine if and what they need to pay for the additional fluctuating income. If there are no commissions, bonuses, rent, etc., for the month or past year, there are no additional payments.
As always, having an experienced family law attorney by your side to navigate your support questions, especially if they include fluctuating income and bonus income, is essential. The Reape-Rickett Law Firm’s family law attorneys can answer your questions and protect your rights, contact us today at (888) 851-1611 or reach out to us Here.