Annualize

An accounting term which means to convert a figure into an annual rate, or yearly average. Both the Child Support Guidelines and Spousal Maintenance Guidelines require Courts to annualize seasonal or fluctuating income by looking at what someone earned over the past few years and take an average. For example, let’s say Melissa, in her role as a seasonal accountant, made $40,000 in 2021, $35,000.00 in 2022, and $15,000.00 in 2023. The Court can annualize her income by taking the average of those three years, which is $30,000.00. ASMG § III(A)(1)(d); CSG § II(A)(1)(c). The Child Support Guidelines also annualize expenses for childcare, education, and extraordinary child expenses. CSG § III(B)(4-6). For child support, the annualization is also meant to ensure “that each month’s child support obligation is increased or decreased in an equal monthly amount, instead of the obligation for particular months being abated, increased, or decreased.” CSG § III(B)(7).