Your ex-spouse received restricted stock units from their employer during your marriage. The divorce decree divided some of those RSUs as property but excluded them from the child support calculation. Now, years later, they’re selling vested shares worth six figures annually — and your child support hasn’t changed. Can you do anything about it?
The Nebraska Supreme Court recently answered that question in Kingston v. Kingston, 320 Neb. 981 (2026). The decision is one of the most significant child support rulings in Nebraska in recent years, particularly for high-income families where stock-based compensation is a major component of earnings. Here’s what the case means for Nebraska parents — whether you’re seeking a modification or defending against one.
Horgan Law LLC represents clients in high-asset divorce and child support matters throughout Douglas County, Sarpy County, and across Nebraska.
What Are RSUs and Why Do They Matter for Child Support?
Restricted stock units (RSUs) are a form of equity compensation that employers — particularly in the tech, financial services, and corporate sectors — use to compensate and retain employees. Unlike salary, RSUs vest over time. When they vest, the employee owns actual shares of company stock, which can then be sold for cash.
The problem for child support purposes is classification. Are RSUs property (divided at divorce) or income (factored into ongoing support)? In many Nebraska divorces, RSUs get treated as property in the marital estate division — split between the spouses — without anyone considering whether the ongoing vesting and sale of RSUs should also count as income for child support purposes. Kingston clarifies that they can be both.
What Did the Nebraska Supreme Court Decide in Kingston v. Kingston?
In Kingston, the father’s original divorce decree calculated child support based on his salary and bonuses. His RSUs were excluded from the income calculation and instead divided as marital property. After the divorce, the father began selling his vested RSUs — something he had not done during the marriage — generating significant additional income beyond his salary.
The mother filed a complaint to modify child support, arguing that the father’s post-divorce RSU sales constituted a material change in circumstances justifying recalculation. The Douglas County District Court agreed, and the Nebraska Supreme Court affirmed.
The Court held several important points. First, the father’s post-divorce sale of RSUs was a material change in circumstances not contemplated by the original decree. Second, the fact that RSUs were previously discussed and divided as property in the divorce did not bar the mother from raising them again in the child support modification context — claim preclusion and issue preclusion did not apply.
Third, the district court did not abuse its discretion in including RSU income, averaging bonus payments over a three-year period, and accounting for taxes when recalculating support.
The practical result: child support increased from $667 per month to $1,123 per month while both children were minors.
Can RSUs Be Both Property and Income Under Nebraska Law?
Yes. Kingston makes clear that the same RSUs can be divided as marital property during divorce and later counted as income for child support modification. This is not double-counting in the court’s analysis — the property division addresses the value of the RSUs at the time of divorce, while the child support modification addresses the ongoing cash flow generated when those RSUs are later sold.
This is consistent with Nebraska’s broad definition of income for child support purposes. The Nebraska Child Support Guidelines define total monthly income to include income from all sources, and they require income to be annualized and divided by twelve. Neb. Ct. R. § 4-204 casts a wide net, encompassing wages, salaries, commissions, bonuses, dividends, interest, trust income, and virtually any other recurring receipt of money.
The key factor in Kingston was that the RSU sales produced real, recurring cash flow after the divorce — not hypothetical value sitting on paper. The court was dealing with vested shares that had actually been sold, giving the court a concrete record of funds received beyond salary and bonus.
What Qualifies as a Material Change in Circumstances for Child Support Modification?
Under Nebraska law, a court may modify a child support order when there has been a material change in circumstances that was not contemplated by the original decree. The change must be something the parties did not anticipate or account for at the time of the divorce.
In Kingston, the material change was the father’s new pattern of selling vested RSUs after the divorce — conduct that had not occurred during the marriage and was not factored into the original support calculation. The court emphasized that this was not simply a change in law (following the Nebraska Supreme Court’s earlier decision in Vanderveer, which had recognized RSU income), but a change in the father’s actual financial conduct.
Common material changes that can support a modification request include: a significant increase or decrease in either parent’s income; a change in custody or parenting time; a child’s changed needs (medical expenses, educational costs); the emancipation of one child when support covers multiple children; or the loss or gain of employment.
How Does This Affect High-Income Nebraska Divorces Going Forward?
Kingston has several practical implications for Nebraska families dealing with equity compensation.
For parents paying support: if you receive RSUs as part of your compensation and are selling vested shares, you should expect that this income may be included in a future child support calculation — even if your original decree excluded RSUs from the income analysis. Planning for this possibility is important, particularly when negotiating the original divorce settlement.
For parents receiving support: if your co-parent’s financial situation has materially changed since the original decree — whether through RSU sales, promotions, bonuses, or other increased compensation — you may have grounds to seek a modification. The fact that RSUs were addressed in the property division does not prevent you from raising them in a support modification.
For attorneys drafting divorce decrees: Kingston underscores the importance of addressing RSU income explicitly in the original decree and child support worksheets. If the parties intend for RSUs to be excluded from future support calculations, that intent should be documented clearly — though whether such an exclusion would bind a future court is an open question.
Frequently Asked Questions
Do all RSUs count as income for child support in Nebraska?
Not necessarily. The Kingston decision turned on the fact that the father was actually selling vested RSUs and receiving cash proceeds. Unvested RSUs that haven’t been sold are less likely to count as current income, though they may be relevant to the overall financial picture. The critical factor is whether the RSUs have produced real, usable income.
Can I modify child support if my ex got a raise but doesn’t have RSUs?
Yes. Any material change in circumstances — including a significant salary increase, new bonus structure, or additional income source — can support a modification request under Nebraska law. The Kingston case specifically addressed RSUs, but the material-change standard applies broadly to all forms of income.
How far back can a child support modification be applied in Nebraska?
Nebraska courts have discretion on retroactivity. In Kingston, the court applied the modification retroactively but not as far back as the mother requested. Generally, modifications can be applied back to the date the complaint for modification was filed, but the specific retroactivity date is within the court’s discretion.
What if my divorce decree specifically excluded RSUs from income?
Kingston held that the original decree’s treatment of RSUs as property (rather than income) did not bar a later modification based on changed circumstances. However, if your decree contains specific language about RSU income and future modifications, that language may affect the analysis. Consult an attorney to review your specific decree.
If you have questions about child support modification, RSU income, or any high-asset family law matter in Nebraska, Horgan Law LLC can help. Contact us at 402-965-0652 or visit horganlawfirm.com/contact-us to schedule a consultation.
Contact Horgan Law LLC
Horgan Law LLC handles complex civil litigation across Nebraska, including disputes involving the death of a party, estate claims, probate litigation, and related matters. If you have questions about a pending lawsuit involving a deceased party, revivor requirements, or the interaction between civil litigation and probate administration, contact our office to discuss your situation.
This article is intended for general educational purposes and does not constitute legal advice. Every situation is different. Consult a licensed Nebraska attorney for guidance specific to your circumstances.
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