                  COURT OF APPEALS OF VIRGINIA


Present: Judges Benton, Coleman and Fitzpatrick
Argued at Richmond, Virginia


LINDA S. FRAZER
                                            OPINION BY
v.     Record Nos. 1699-95-2 and   JUDGE JOHANNA L. FITZPATRICK
                   1975-95-2             OCTOBER 29, 1996

JAMES DOUGLAS FRAZER


          FROM THE CIRCUIT COURT OF CHESTERFIELD COUNTY
                    William R. Shelton, Judge
          Gail H. Miller; John Randolph Smith (Smith &
          Miller, P.C., on briefs), for appellant.

          Murray J. Janus (Deanna D. Cook; Bremner &
          Janus, on brief), for appellee.



      Linda S. Frazer (wife) appeals the trial court's decisions

on equitable distribution, spousal support, and child support.

She argues, inter alia, that the trial court erred in:    (1)

valuing the business of James Douglas Frazer (husband); (2)

dividing the parties' Merrill Lynch accounts; (3) crediting

husband with his separate property; (4) dividing the parties'

Harmony Hills property; (5) ordering each party to pay fifty

percent of extraordinary medical expenses for their son; (6)

failing to award wife additional pendente lite spousal support
and awarding permanent spousal support beginning one month after

entry of the final decree; (7) determining husband's gross income

for spousal support purposes; (8) calculating spousal support;

(9) modifying the child support award after wife had appealed the

final decree to this Court; (10) including wife's spousal support
in her income for child support purposes; (11) the distribution

to husband of his First Penn life insurance policy valued at

$12,000; (12) the division of the cash value of a life insurance

policy owned by husband; and (13) the exclusion of the $870 life

insurance premium from the marital estate.    For the following

reasons, we remand to the trial court for further proceedings in

accordance with this opinion.
                            BACKGROUND

     The parties were married on December 16, 1978.    After their

marriage, husband adopted wife's daughter from her first

marriage, and their son Ben was born on February 5, 1980.   The

parties separated when husband left the marital residence on

October 7, 1992.

     Husband filed a bill of complaint for divorce on December

31, 1992.   A pendente lite hearing was held January 20, 1994, and

the trial court awarded wife custody of the parties' son, $1,704

per month in child support, and $1,000 in spousal support for

three months.   Evidence on equitable distribution and support

issues was taken by deposition, and each party submitted exhibits

to the trial court.

     The evidence established that, when the parties married in

1978, husband worked for Litton Industries.   In 1984, husband

left Litton, and the parties started Frazer Sales & Associates,

Inc., with husband as the sole shareholder.   Husband's monetary

contributions to the marriage were far greater than wife's.    His



                                 2
monthly salary was approximately $18,000.      Husband's nonmonetary

contributions included coaching Ben's soccer team, cleaning the

house, and maintaining the yard.       Wife's nonmonetary

contributions to the marriage included maintaining the home,

cooking, caring for the children, and doing the family's laundry

and shopping.    She also was involved in community activities,

helped husband with his business, and entertained his clients.

The standard of living established during the marriage was high.

The parties lived in a large home and owned luxury vehicles, a

sport fishing boat, and a condominium in Hampton, Virginia.
        The trial court issued its first letter opinion on October

6, 1994, and a subsequent letter opinion on October 28, 1994,

both resolving issues of equitable distribution and child

support.    The court held a hearing on February 2, 1995 to

consider the parties' requests for division of the marital

assets.    The final letter opinion dated March 3, 1995 resolved

the issues of equitable distribution, spousal support, and child

support.    A final decree of divorce was entered July 7, 1995, and

incorporated the letter opinions of October 28, 1994 and March 3,

1995.

        Wife appealed the final decree to this Court on August 1,

1995.    On August 3, 1995, the trial court reduced husband's child

support obligation to comply with the new legislative guidelines

enacted July 1, 1995.    On August 30, 1995, wife noted her appeal

of the August 3, 1995 order.    By order of this Court dated




                                   3
September 19, 1995, the two appeals were consolidated for

briefing and argument.




                                4
                    VALUATION OF HUSBAND'S BUSINESS

        Husband is the sole stockholder of Frazer Sales &

Associates, Inc., a manufacturer's representative business.

Wife's expert, who was qualified in valuing similar businesses,

valued husband's business at $423,500 and prepared a detailed

written report.    In evaluating the business, wife's expert relied

upon the business' tax returns and information obtained from wife

about the history of the business until she left the business in

1991.    He also considered the customers and the general operation

of the business.    Wife's expert had no contact with husband, his

employees, or customers in gathering information about the

business.
        Husband's expert, the accountant for the business, reviewed

corporate books and records and had prepared the business' 1993

tax return.    In determining the value of the business, he

examined its capital assets and current income and expenses.

Husband's expert valued the assets of the business at $75,000 and

opined that the business had "perhaps as much as $150,000.00 in

value."    Husband's expert emphasized the personal nature of

husband's relationships with his clients and the importance of

husband's participation to the business' continued success.

Additionally, husband testified that he had worked twenty-six

years in developing his relationships with his two customers and

that the business would have no value if he was not part of the

company.    The trial court accepted husband's evidence and valued




                                   5
the business at $150,000.

     Wife argues that the trial court erred in accepting

husband's expert's value of Frazer Sales and in rejecting wife's

expert's detailed analysis.

     "Conflicting expert opinions constitute a question of fact

. . . ."    McCaskey v. Patrick Henry Hosp., 225 Va. 413, 415, 304

S.E.2d 1, 5 (1983).   The trial court's "province alone, as the

finder of fact, [is] to assess the credibility of the witnesses

and the probative value to be given their testimony."    Richardson

v. Richardson, 242 Va. 242, 246, 409 S.E.2d 148, 151 (1991).      In

determining the value of marital property, "'the finder of fact

is not required to accept as conclusive the opinion of [any]

expert.'"    Stratton v. Stratton, 16 Va. App. 878, 883, 433 S.E.2d

920, 923 (1993) (quoting Lassen v. Lassen, 8 Va. App. 502, 507,

383 S.E.2d 471, 474 (1989)).   Additionally, the trial court, as

fact finder, "'has a right to weigh the testimony of all the

witnesses, experts and otherwise.'"    Bell Atlantic Network Servs.
v. Virginia Employment Comm'n, 16 Va. App. 741, 746, 433 S.E.2d

30, 33 (1993) (emphasis added) (quoting Pepsi-Cola Bottling Co.

v. McCullers, 189 Va. 89, 99, 52 S.E.2d 257, 261 (1949)).

     In the instant case, the trial court accepted the valuation

of husband's expert after weighing the valuations presented by

both experts and the basis for each expert's opinion.   Husband's

expert was clearly familiar with the daily workings of the

business and its records and assets, and based his opinion in




                                  6
part on the importance of husband's personal contributions to the

success of the business.   Although wife's expert had valued

similar businesses and prepared a detailed analysis of the

business' value, he relied primarily on outside information

obtained from wife.   The trial court was not required to accept

his valuation and could "weigh the testimony of all the . . .

experts."    Bell Atlantic, 16 Va. App. at 746, 433 S.E.2d at 33.

Under these circumstances, the trial court was not plainly wrong

in accepting the valuation of husband's expert rather than that

of wife's.
                       MERRILL LYNCH ACCOUNTS

     In wife's Exhibit 1 submitted May 3, 1994, she listed three

Merrill Lynch accounts totaling $132,827 as marital assets:    (1)

a $69,168 account in the name of husband's business; (2) a

$10,360 account in husband's name; and (3) a $53,299 account in

wife's name.   Husband testified in his deposition on April 27,

1994 that he had two accounts with Merrill Lynch, one personal

and one corporate, and that the parties shared a joint bond

account.    However, in husband's Exhibit 4 submitted May 24, 1994

and during his deposition taken that day, he indicated a single

Merrill Lynch account in wife's possession with a value of
$132,827.    In the trial court's first letter opinion dated

October 6, 1994, the court classified all of the accounts as

marital property and valued them at $132,827.

     On October 18, 1994, wife filed a motion to reconsider,




                                  7
arguing that husband omitted certain investments from his

exhibit.   She submitted an account statement that showed an

additional value in husband's personal Merrill Lynch account of

$33,180, dated November 27, 1992, two years before either husband

or wife submitted exhibits to the court.   At the October 20, 1994

hearing, the trial court refused to hear additional evidence

regarding the accounts and ruled that "there must be a limit on

the time in which evidence can be submitted."   In its final

letter opinion of March 3, 1995, the trial court assigned the

value of the accounts--$101,101 to wife and $31,726 to husband.

In the final decree entered July 7, 1995, the court ordered the

parties to "sign whatever papers are necessary to effectuate the

transfers of vehicles, partnerships and other property," and

ordered wife to pay husband a monetary award of $31,726.
     Wife contends that the trial court erred in refusing to

allow her to present additional evidence of the value of the

Merrill Lynch accounts after the evidence was concluded because

husband misrepresented the value of his personal Merrill Lynch

account by omitting certain investments.   A trial court "may not

refuse or fail to give parties a reasonable opportunity to

develop and present evidence of value."    Mosley v. Mosley, 19 Va.

App. 192, 195, 450 S.E.2d 161, 163 (1994).   Although the trial

court gave wife ample opportunity to present evidence of the

value of the Merrill Lynch accounts, the record fails to show

when the report dated November 27, 1992, became known to or was




                                 8
available to the wife.   The record shows that although husband

made no misrepresentations regarding the value of his personal

Merrill Lynch account, he did fail to disclose the existence or

value of a personal account of $33,180, dated November 27, 1992.

Because the classification and evaluation of the Merrill Lynch

accounts must be reviewed on remand, no rationale exists for

excluding the additional account from equitable distribution.

     Wife also argues that the trial court erred in failing to

determine the actual ownership of each account.   Code
§ 20-107.3(A) provides, in pertinent part, as follows:
               Upon decreeing the dissolution of a
          marriage, and also upon decreeing a divorce
          from the bond of matrimony, or upon the
          filing with the court as provided in
          subsection J of a certified copy of a final
          divorce decree obtained without the
          Commonwealth, the court, upon request of
          either party, shall determine the legal title
          as between the parties, and the ownership and
          value of all property, real or personal,
          tangible or intangible, of the parties and
          shall consider which of such property is
          separate property, which is marital property,
          and which is part separate and part marital
          property in accordance with subdivision A 3.


(Emphasis added).   "Code § 20-107.3 details the steps which a

trial court must follow in determining the equitable distribution

of property.   The court must first determine the legal title as

between the parties and the ownership and value of all property.
The court must also determine whether the property is marital or

separate property."   Robinette v. Robinette, 4 Va. App. 123, 128,

354 S.E.2d 808, 810 (1987) (emphasis added).   In dividing the



                                 9
property of divorcing parties, "the court shall have no authority

to order the division or transfer of separate or marital property

which is not jointly owned."    Code § 20-107.3(C) (emphasis

added).

     In the instant case, the record fails to show that the trial

court followed the steps required by Code § 20-107.3(A) in

dividing the Merrill Lynch accounts.     Although the trial judge

properly classified the accounts as marital property and

determined the total amount in the accounts to be $132,827, the

court failed to make specific findings about how many accounts

existed, what each account was worth, and who owned which

accounts.   Wife's exhibit indicated three separate accounts

totaling $132,827, one titled in her name, one in husband's name,

and one in the name of the business.     Husband indicated that he

had two accounts with Merrill Lynch, one titled in his name and

one in the name of the business.      However, husband also testified

that wife was in possession of one Merrill Lynch account with a

value of $132,827.   Thus, because the evidence is in conflict

about who owned which accounts and the trial court failed to make

any specific findings regarding ownership of the accounts, on

remand, the trial court must reexamine these accounts, determine

the ownership of the accounts, and then divide the account assets

in accordance with Code § 20-107.3.
                     HUSBAND'S SEPARATE PROPERTY

     Before the parties married in 1978, husband worked for



                                 10
Litton Industries and had a retirement plan with that company.

After the parties married, husband continued working for Litton

for six years until 1984.    When husband left Litton, he rolled

over his $40,000 Litton retirement plan, a portion of which had

accrued prior to the marriage, into his pension with Frazer

Sales.    Husband testified that he had "no idea" what the value of

the Litton retirement plan was at the time of his marriage to

wife.    Husband estimated the current value of the Litton

retirement plan to be $72,000.    The trial court awarded the

$72,000 retirement plan to husband as his separate property.
        Wife argues that the trial court erred in awarding the

entire Litton retirement plan to husband as his separate property

when undisputed evidence clearly established that a portion of

the plan was marital and a portion was separate.

        Code § 20-107.3(A)(2) provides as follows:
             All property including that portion of
             pensions, profit-sharing or deferred
             compensation or retirement plans of whatever
             nature, acquired by either spouse during the
             marriage, and before the last separation of
             the parties, if at such time or thereafter at
             least one of the parties intends that the
             separation be permanent, is presumed to be
             marital property in the absence of
             satisfactory evidence that it is separate
             property.


(Emphasis added).    "Separate property" includes "all property,

real and personal, acquired by either party before the marriage."

Code § 20-107.3(A)(1)(i).     Pursuant to Code § 20-107.3(A)(3), a

trial court must classify the parties' property as part marital




                                  11
and part separate in certain circumstances.    "In the case of any

pension, profit-sharing, or deferred compensation plan or

retirement benefit, the marital share as defined in subsection G

shall be marital property."    Code § 20-107.3(A)(3)(b). 1

        The evidence established that husband's employment with

Litton began before the marriage and that husband continued

working for Litton for six years after the parties married.

Under Code § 20-107.3(A)(1), the portion of the Litton retirement

plan attributable to husband's efforts before the parties married

is presumed to be his separate property.    The portion of the

Litton retirement plan earned during the marriage is presumed

marital unless husband produces satisfactory evidence that it is

separate.    Code § 20-107.3(A)(2), (G).   Husband estimated that

the 1984 value of the Litton retirement plan was $40,000 and that

the current value of the plan is $72,000.    However, husband

failed to show which portion was earned before the marriage

(separate) and which portion was earned during the marriage

(marital).    Thus, the trial court erred in awarding husband the

entire $72,000 Litton retirement plan as his separate property.
On remand the trial court must: (1) determine the value of the

marital and separate shares of these retirement benefits; (2)

determine the rights and equities of the parties in the marital
    1
     Code § 20-107.3(G) defines "marital share" as "that portion of
the total interest, the right to which was earned during the
marriage and before the last separation of the parties, if at such
time or thereafter at least one of the parties intended that the
separation be permanent."



                                  12
share; and (3) if an award is to be made, to award a percentage

of benefits which comports with the requirements of Code

§ 20-107.3 (G).
                     HARMONY HILLS PROPERTY

     The parties owned a jointly-titled property in Harmony Hills

in Richmond, Virginia valued at $135,000.   Neither party wanted

the property, and the court ordered the property sold and the

proceeds divided $109,500 (eighty-one percent) to wife and

$25,500 (nineteen percent) to husband.   In the final decree, the

court ordered that any proceeds from the sale of the property

exceeding $135,000 be divided in the same percentage.
     Wife argues that the trial court erred in dividing the

proceeds from the sale of the Harmony Hills property in a manner

inconsistent with the joint ownership of the parties, i.e.,

failing to divide the sale proceeds fifty-fifty.   Although the

trial court awarded wife the greater portion of the sale

proceeds, she contends that this award will subject her to

greater capital gains tax liability than husband, and that the

court erred in failing to consider the tax consequences of its

unequal division of the sale proceeds.

     Code § 20-107.3(C) provides as follows:
          The court may, based upon the factors listed
          in subsection E, divide or transfer or order
          the division or transfer, or both, of jointly
          owned marital property, or any part thereof.

               As a means of dividing or transferring
          the jointly owned marital property, the court
          may transfer or order the transfer of real or
          personal property or any interest therein to



                               13
          one of the parties, permit either party to
          purchase the interest of the other and direct
          the allocation of the proceeds, provided the
          party purchasing the interest of the other
          agrees to assume any indebtedness secured by
          the property, or order its sale by private
          sale by the parties, through such agent as
          the court shall direct, or by public sale as
          the court shall direct without the necessity
          for partition.


The trial court had authority to order the sale of the parties'

Harmony Hills property pursuant to Code § 20-107.3(C).

Additionally, because Code § 20-107.3(C) does not require that

the trial court equally divide the proceeds from the sale of

jointly owned property, the trial court did not err in dividing

the proceeds of the sale eighty-one percent to wife and nineteen

percent to husband.
     In dividing jointly owned marital property, the trial court

must consider the specified factors in Code § 20-107.3(E),

including "[t]he tax consequences to each party."    Code

§ 20-107.3(E)(9).    Wife's argument that she will be subject to

greater tax liability because of the unequal division of the sale

proceeds is of no consequence.    The wife received a substantially

greater portion of the sale proceeds than did the husband and the

court necessarily considered that each would bear his and her

proportionate share of capital gains taxes.    Thus, the trial

court did not err in apportioning the sale proceeds eighty-one

percent to wife and nineteen percent to husband.
                    EXTRAORDINARY MEDICAL EXPENSES

     At the hearing on February 2, 1995, wife asked the court to



                                  14
order husband to pay his "share of the extraordinary health care

costs of our son, including those for orthodontic treatment and

prescriptions for ritilin (on[-]going expense)."   In the final

opinion letter dated March 3, 1995, the trial court ordered

husband to maintain the orthodontic care of the parties' son and

the parties to "divide equally the extraordinary medical expenses

not covered by insurance."   The record does not indicate the

amount of extraordinary medical expenses incurred by the parties'

son, specifically, the amount paid for his on-going ritilin

prescription.
     Wife asserts that the trial court erred in ordering the

parties to divide equally the extraordinary medical expenses not

covered by insurance because these expenses should have been

divided according to the child support obligation of each party.

     Code § 20-108.2(D) provides as follows:
               Any extraordinary medical and dental
          expenses for treatment of the child or
          children shall be added to the basic child
          support obligation. For purposes of this
          section, extraordinary medical and dental
          expenses are uninsured expenses in excess of
          $100 for a single illness or condition and
          shall include but not be limited to
          eyeglasses, prescription medication,
          prostheses, and mental health services
          whether provided by a social worker,
          psychologist, psychiatrist, or counselor.


(Emphasis added).   "A primary rule of statutory construction is

that courts must look first to the language of the statute.     If a

statute is clear and unambiguous, a court will give the statute

its plain meaning."   Loudoun County Dep't of Social Servs. v.



                                15
Etzold, 245 Va. 80, 85, 425 S.E.2d 800, 802 (1993).

     This Court has held that Code § 20-108.2(D) contemplates

"payment for past expenses as well as continuing expenses."

Carter v. Thornhill, 19 Va. App. 501, 507, 453 S.E.2d 295, 300

(1995).   In Carter, the mother incurred substantial medical

expenses for the treatment of the parties' daughter, who was in a

serious car accident.    The father filed a petition to modify

child support, and the mother responded that the guideline amount

was inadequate to cover the daughter's medical expenses.    Id. at

503-04, 453 S.E.2d at 297-98.    The trial court determined the

parties' child support obligations under the guidelines, deviated

from the guidelines because of the extraordinary medical

expenses, and ordered the father to pay his percentage of the

accrued medical expenses to the mother in a lump sum.    Id. at

504-06, 453 S.E.2d at 298-99.    This Court determined that "the

trial court's order was not a retroactive modification but a

prospective award."     Id. at 505, 453 S.E.2d at 298.

     Although not specifically on point, our decision in Carter
upheld the division of extraordinary medical expenses according

to "the percentages owed by each party toward [the] daughter's

support."   Id. at 506, 453 S.E.2d at 299.   The plain meaning of

Code § 20-108.2(D) contemplates a division of extraordinary

medical expenses as part of "the basic child support obligation."

    While the record in this case established that the parties'

son suffered from a condition requiring an on-going prescription




                                  16
for ritilin, no evidence indicated the exact nature of his

condition or whether the prescription expenses were over $100.

Thus, insufficient evidence supports the trial court's award of

extraordinary medical expenses.    Additionally, considering the

plain meaning of Code § 20-108.2(D), we hold that the trial court

erred in dividing equally the extraordinary medical expenses not

covered by insurance rather than by a percentage equal to each

party's child support obligation.      On remand, the trial court

should calculate each party's responsibility for any specific,

extraordinary medical expenses established by the evidence,

dividing these expenses in accordance with "the basic child

support obligation" of each party. 2
                            SPOUSAL SUPPORT
                 (1) Pendente Lite Spousal Support and
                  Timing of Permanent Spousal Support


        After a hearing on January 20, 1994, the trial court awarded
    2
     Other states also provide for the inclusion of extraordinary
medical expenses in the basic child support obligation. See,
e.g., In re Marriage of Pollock, 881 P.2d 470, 472 (Colo. Ct. App.
1994) ("[E]xtraordinary medical expenses incurred on behalf of the
children are to be added to the basic child support obligation and
divided between the parents in proportion to their adjusted gross
incomes."); Lloyd v. Lloyd, 649 So. 2d 32, 36 (La. Ct. App. 1994)
("By agreement of the parties or by order of the court,
extraordinary expenses incurred on behalf of the child shall be
added to the basic child support obligation.") (quoting La. Rev.
Stat. § 9:315.5); Petrini v. Petrini, 648 A.2d 1016, 1019 n.8 (Md.
1994) (recognizing that extraordinary medical expenses may be
added to the basic child support obligation and holding that the
basic child support obligation is "divided proportionately between
the parents in relation to their 'adjusted actual incomes'"); In
re Marriage of Weed, 836 P.2d 591, 594 (Mont. 1992) (holding that
extraordinary medical expenses "should be prorated between the
parents and added to supplement the child support obligation").



                                  17
wife pendente lite spousal support of $1,000 per month for three

months, commencing February 1, 1994.    The trial court gave no

reason for limiting wife's pendente lite support to three months.

Husband continued to pay wife spousal support until October

1994.    On February 2, 1995, wife requested an award of spousal

support retroactive to October 6, 1994.    The trial court issued

its final letter opinion on March 3, 1995, awarding wife

permanent spousal support commencing one month from the date of

the final decree.    The final decree was not entered until July 7,

1995.    From October 1994 to August 1995, wife received no spousal

support.
        Wife argues that the trial court erred in refusing to extend

her pendente lite spousal support beyond the original three-month

period and in ordering permanent spousal support to commence one

month after entry of the final decree.

        We recognize that the decision "[w]hether to grant pendente

lite support lies within the sound discretion of the trial

judge."     Weizenbaum v. Weizenbaum, 12 Va. App. 899, 905, 407

S.E.2d 37, 40 (1991).    Although a trial court may in its

discretion limit the duration of a pendente lite support award to

the period of time reasonably necessary for the parties to

conclude their litigation, nevertheless, in this case, the trial

judge after finding a need for support gave no reason for

limiting wife's pendente lite support to three months.       If

husband had stopped paying pendente lite spousal support after



                                  18
the three-month period ended in April 1994, wife would have been

without any spousal support for over one year.    Because wife

showed a need for spousal support, and the record reflects no

rationale for the time limitation imposed, we hold that the trial

court abused its discretion in limiting her pendente lite spousal

support to three months.

     Additionally, "the trial court [has] discretion to enter the

award of spousal support effective any time after the date of the

commencement of the suit."   Konefal v. Konefal, 18 Va. App. 612,

614, 446 S.E.2d 153, 154 (1994).     Under the circumstances in this

case, the trial court abused its discretion in ordering permanent

spousal support to begin one month from entry of the final

decree.   The trial court found that wife had established a need

for permanent spousal support at the March 1995 hearing.

However, its timing of the award of permanent spousal support

combined with the earlier discontinuance of pendente lite support

left her without any support for approximately ten months.
  (2) Husband's Voluntary Contributions to a Retirement Account
             and Amount of Permanent Spousal Support


     Husband submitted evidence that showed his income to be

$18,167 per month.   His evidence included a W-2 form, showing a

monthly salary of $17,895, and Exhibit 11, which indicated that

he drew $10,000 per month in salary and averaged $8,167 per month

in commissions.   Wife's expert determined husband's average

monthly income to be $22,330 by using a six-year weighted

average, and his monthly income for 1993 to be $27,084.


                                19
    Husband admitted that he voluntarily contributed $30,000

from his gross income to his retirement plan in 1993.   Husband's

accountant confirmed that husband added $30,000 to his retirement

account in 1993 and that, if husband had not put the money into

his retirement plan, he could have taken "it as additional

compensation in the form of a bonus, or additional salary."    The

trial court excluded the voluntary retirement contributions from

the calculation of husband's gross income and determined

husband's monthly income to be $18,167.   Wife's monthly income

was established as $2,260.    Wife's evidence indicated that her

monthly expenses were over $11,000, and included monitoring of

her ongoing health problems.   Husband's evidence established that

his monthly expenses were $8,651, and included over $1,000 per

month to maintain his boat.    In the March 3, 1995 letter opinion,

the court set permanent spousal support at $416 per month.
     Wife argues that the trial court erred in failing to include

husband's voluntary contributions to his retirement plan in his

gross income for the purposes of determining spousal support.

     Code § 20-107.1 provides that, in determining spousal

support, the trial court shall consider "[t]he earning capacity,

obligations, needs and financial resources of the parties,

including but not limited to income from all pension, profit

sharing or retirement plans, of whatever nature."   Code

§ 20-107.1(1) (emphasis added).    No Virginia case has addressed

the issue of whether voluntary contributions to a retirement plan




                                  20
should be included in a spouse's income when determining spousal

support.   However, other jurisdictions who have addressed this

issue include a spouse's voluntary contributions to a retirement

account, pension plan, or savings account in gross income in a

child support context.   See, e.g., Nelson v. Nelson, 651 So. 2d

1252, 1253-54 (Fla. Dist. Ct. App. 1995) (no deduction from gross

income allowed for party's voluntary contributions to retirement

account); State ex rel. Nielsen v. Nielsen, 521 N.W.2d 735, 737

(Iowa 1994) ("Our guidelines specifically do not allow a

deduction for voluntary savings or payment of indebtedness.");
Lebrato v. Lebrato, 529 N.W.2d 90, 98-99 (Neb. Ct. App. 1995)

("The Guidelines do not allow a deduction for contributions to

voluntary retirement plans in arriving at net income . . . .");

Shaver v. Kopp, 545 N.W.2d 170, 175 (N.D. 1996) (gross income is

income from any source and includes an employee's voluntary

contributions to tax-deferred savings and his employer's matching

contributions); Heisey v. Heisey, 633 A.2d 211, 212 (Pa. Super.

Ct. 1993) (only non-voluntary retirement payments may be

subtracted from gross income).

     We find no reason to calculate gross income for the

determination of spousal support in a manner different from the

calculation of gross income in the child support context when

addressing a voluntary contribution to a savings or deferred

compensation plan.   For purposes of determining child support

Code § 20-108.2(C) defines gross income as follows:
          For purposes of this section, "gross income"


                                 21
          shall mean all income from all sources, and
          shall include, but not be limited to, income
          from salaries, wages, commissions, royalties,
          bonuses, dividends, severance pay, pensions,
          interest, trust income, annuities, capital
          gains, social security benefits except as
          listed below, workers' compensation benefits,
          unemployment insurance benefits, disability
          insurance benefits, veterans' benefits,
          spousal support, rental income, gifts, prizes
          or awards. Gross income shall be subject to
          deduction of reasonable business expenses for
          persons with income from self-employment, a
          partnership, or a closely held business.
          "Gross income" shall not include benefits
          from public assistance programs as defined in
          § 63.1-87, federal supplemental security
          income benefits, or child support received.

(Emphasis added).   Under Code § 20-108.2(C), gross income

includes "all income from all sources," and unless specifically

excluded, any income from any source is subject to inclusion.

Clearly, Code § 20-108.2(C) does not specifically exclude

voluntary contributions to retirement plans from the definition

of gross income in a child support calculation.

     While the statutory language does not specify the same

scheme in a spousal support calculation, the same rationale is

applicable.   Thus, we hold that a spouse's voluntary

contributions to a retirement account should be included in his

or her gross income for both spousal and child support purposes.

A spouse and/or parent should not be allowed to voluntarily

divert funds for retirement in order to exclude that income from

consideration in determining spousal or child support. Code

§ 20-107.1(1) requires the trial court in setting spousal support

to consider the "earning capacity" of the parties.   Although


                                22
"earning capacity" necessarily includes actual earnings, it is a

broader concept that allows the trial court to consider more than

actual earnings.   Nevertheless, a party's voluntary contributions

to a retirement account are actual earnings that are merely set

aside for the future, and such contributions or deferred income

must be considered in determining a spouse's income and ability

to pay spousal support.

    The evidence established that husband voluntarily placed

$30,000 per year in his retirement account with Frazer Sales.

Husband unilaterally chose to contribute $30,000 of actual income

into a retirement scheme of his own choosing and for his sole

benefit.   Wife's spousal support award was less than fifteen

percent of the husband's voluntary contribution to his

retirement.   Although a support award is based upon a balancing

of the parties' incomes and earning capacities and their

respective needs, under these circumstances, the trial court

erred in failing to include husband's voluntary contributions to

his retirement account in his gross income for purposes of

determining spousal and child support.
     Wife also contends that the trial court awarded an

inadequate amount of spousal support.    Because we hold that the

trial court should have included husband's voluntary

contributions to his retirement plan in his income, on remand,

the trial court shall reconsider its award of spousal support to

wife in accordance with the factors of Code § 20-107.1.



                                23
                               CHILD SUPPORT

           (1) Modification after Appeal to Court of Appeals

        The final decree in this case was entered on July 7, 1995,

and wife filed her notice of appeal in this Court on August 1,

1995.    The legislature enacted new statutory guidelines for child

support effective July 1, 1995.      In an August 3, 1995 order, the

trial court found that the legislative change in the guidelines

was a material change in circumstances and reduced husband's

child support obligation.
        Wife contends that the trial court erred in modifying the

child support award after the final decree had been appealed to

this Court.

        "The orderly administration of justice demands that when an

appellate court acquires jurisdiction over the parties involved

in litigation and the subject matter of their controversy, the

jurisdiction of the trial court from which the appeal was taken

must cease."     Decker v. Decker, 17 Va. App. 562, 564, 440 S.E.2d

411, 412 (1994) (quoting Greene v. Greene, 223 Va. 210, 212, 288
S.E.2d 447, 448 (1982)).      This Court acquires jurisdiction over a

case when the appeal is filed and docketed in the clerk's office

of the Court.     Id.    "Thus, while the trial court may enforce a

support and custody order, it may not modify such order without

leave of court."        Id.

        In this case, wife filed her first notice of appeal in the

clerk's office of this Court on August 1, 1995, challenging the



                                    24
trial court's final decree of July 7, 1995.    At that point, this

Court acquired jurisdiction over the case.    On August 3, 1995,

two days after this Court acquired jurisdiction over the case,

the trial court modified husband's child support obligation based

upon the legislature's changes in the child support guidelines.

Thus, the trial court had no jurisdiction to modify the child

support award without leave from this Court.
              (2) Wife's Spousal Support as Income

     Finally, wife asserts that the trial court erred in

including her spousal support in her income when it calculated

husband's child support obligation.

     Code § 20-108.2(C) provides, in pertinent part, that

"spousal support included in gross income [for child support

purposes] shall be limited to spousal support paid pursuant to a

pre-existing order or written agreement and spousal support shall

be deducted from the gross income of the payor when paid pursuant

to a pre-existing order or written agreement between the parties

to the present proceeding."   This Court has defined a

"pre-existing order" as "an order that has continuing effect and

that provides a spouse with an income source."    Sargent v.

Sargent, 20 Va. App. 694, 706, 460 S.E.2d 596, 601 (1995).

However, a spousal support order must also "pre-exist" the child

support calculation.   Additionally, although a spousal support

order must pre-exist the determination of child support, the

plain meaning of Code § 20-108.2(C) contemplates spousal support




                                25
"between the parties to the present proceeding."

     In the instant case, the trial court did not err in

including wife's spousal support in her income for child support

purposes.   The trial court should follow a three-step process in

resolving issues of equitable distribution, spousal support, and

child support.   Because in determining child support under Code

§ 20-108.2(C), the trial court must include spousal support in

the gross income of the receiving spouse and must deduct the

amount of spousal support from the gross income of the paying

spouse, the court should first determine equitable distribution,

then spousal support, and finally child support.   Although the

trial court properly included wife's spousal support in her

income and deducted spousal support from husband's income, the

court failed to include husband's voluntary contributions to his

retirement account in husband's gross income for purposes of

spousal or child support and must for both reasons recalculate

the amount of child support on remand.
                        INSURANCE POLICIES

     We find no error in the trial court's equitable distribution

decision concerning the life insurance policies.   The record

clearly supports the trial court's resolution of these issues.

In the absence of a showing of an abuse of discretion, we uphold

these decisions.   Srinivasan v. Srinivasan, 10 Va. App. 728, 732,

396 S.E.2d 675, 678 (1990).

    Accordingly, the trial court's rulings on the value of



                                26
husband's business, the division of the Harmony Hills property

and the insurance policies are affirmed.   On remand, the trial

court must reconsider equitable distribution, spousal support,

and child support in accordance with this opinion.
                                        Affirmed in part,
                                        reversed in part,
                                        and remanded.




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