October 25, 2014

Medina
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Ruling: Perks part of child support calculation

COLUMBUS — The Ohio Supreme Court ruled Wednesday that fringe benefits like a company car, car insurance and cell phone should count as income when determining child support payments.

The ruling came in a case involving a Granger Township man who asked Medina County Domestic Relations Judge Mary Kovack to reduce his child support payments because his annual salary as president of the Ohio College of Massotherapy had been reduced from $120,000 to $75,000 in 2010 after the recession.

Jeffrey S. Morrow had been ordered to pay about $2,200 a month in child support payments in 2006.

Kovack rejected the request, ruling that the calculation of Morrow’s child support payments should include $16,756 in fringe benefits. The benefits, which included a car, insurance, cell phone service and Ohio State University football season tickets, all were paid by his employer.

Morrow appealed the decision, but the 9th District Court of Appeals affirmed Kovack’s ruling that such fringe benefits should be considered “other forms of income.”

In appealing to the Supreme Court, Morrow’s attorney argued that fringe benefits only should be included in the income calculation if the person is self-employed or a business owner.

In a 6-1 decision, the high court rejected that argument.

“If his employer did not provide a car, Morrow would have had to purchase or lease one on his own, using his own funds,” the opinion said. “Accordingly, it is sensible to conclude that the provision of a car is no different from the provision of funds to buy or lease a car.”

The justices did say that the trial court should not have included the value of the Ohio State football tickets in the calculation because the tickets were not given to Morrow for his own use, rather for perks for employees or gifts for business associates. But the judges said that error didn’t amount to enough to harm Morrow.

In a dissenting opinion, Justice Terrence O’Donnell wrote that some of the value of the car and insurance that were used for business purposes should have been excluded from the calculation, adding that federal tax policy supports his view.

Contact reporter Kiera Manion-Fischer at (330) 721-4049 or kfischer@medina-gazette.com.