Self-Employed Business Owner Financial Affidavit Reporting (Form 12.902(c))
Reporting self-employment income on a Florida financial affidavit is one of the most heavily litigated areas in family law. Under Fla. Stat. § 61.30(2)(a)(3), gross income includes business income from sources such as self-employment, partnership, close corporations, and independent contracts.
Ordinary and Necessary Business Expenses vs. Personal Add-Backs
Business income is defined as "gross receipts minus ordinary and necessary expenses required to produce income." However, expenses allowed by the IRS for tax purposes are not automatically deductible in family court:
- Accelerated Depreciation (Section 179): Florida courts routinely disallow accelerated depreciation and Section 179 write-offs, adding these paper deductions back to gross income for child support and alimony.
- Personal Automobile & Fuel: When a business pays for a personal vehicle, insurance, or gas, the personal-use percentage must be added back into gross income as an in-kind benefit under § 61.30(2)(a)(13).
- Cellular, Travel & Meals: Discretionary travel, meals, entertainment, and home internet paid through the company account are subject to forensic scrutiny and income add-back.
Mandatory Business Records Under Rule 12.285
Any business owner with an ownership interest of 30% or more must provide 3 years of corporate tax returns (Forms 1120, 1120-S, or 1065), profit and loss statements, and balance sheets within the 45-day mandatory disclosure period.