How Alimony Works in Colorado, Part Two

Calculating temporary alimony can be a contentious process.

Calculating temporary alimony can be a contentious process.

In Part I of my series about alimony in Colorado (which you can read here), I discussed how alimony (officially called “maintenance”) is awarded as part of temporary orders while a divorce is pending.  Specifically, that post dealt with the formula that is presumptively applied when the parties earn a combined annual income of $75,000 or less.  In this post, I will continue with the discussion of temporary maintenance (that is, maintenance awarded before the divorce is final) for situations in which the spouses together earn more than $75,000 per year.

When the husband and wife’s combined annual income is greater than $75,000 per year, there is no presumptive formula or guideline for the court to apply.  As such, the amount to be awarded is determined on a case-by-case basis.  Each case is different, and different judges will calculate temporary alimony differently.

Step 1.  Is a spouse eligible for temporary maintenance? The first thing that the court must determine is whether the spouse seeking alimony is eligible to receive it.  The court must find that the seeking spouse:

(a)    Lacks sufficient property, including marital property apportioned to him or her, to provide for his or her reasonable needs; and
(b)    Is unable to support himself or herself through appropriate employment or is the custodian of a child whose condition or circumstances make it appropriate that the custodian not be required to seek employment outside the home.

“Reasonable needs” and “appropriate employment” are considered in light of the expectations that the spouses have developed during the marriage.  “Reasonable needs” means more than bare essentials, but considers the spouses’ lifestyle during the marriage.  “Appropriate employments” means employment suited to the individual.  Not just any job, but a job suited to the person.

Step Two. Determining the Amount of Temporary Maintenance.Once the court determines that a spouse lacks sufficient property to support himself or herself, and that he or she is unable to support himself or herself by suitable employment, the court will go on to determine how much support should be paid to the other spouse.  This calculation is very subjective.  The court will consider “all relevant factors,” including six factors listed in the statute:

(a)    The financial resources of the party seeking maintenance, including marital property apportioned to such party, and the party’s ability to meet his or her needs independently, including the extent to which a provision for support of a child living with the party includes a sum for that party;

(b)    The time necessary to acquire sufficient education or training to enable the party seeking maintenance to find appropriate employment and that party’s future earning capacity;

(c)    The standard of living established during the marriage;

(d)    The duration of the marriage;

(e)     The age and the physical and emotional condition of the spouse seeking maintenance; and

(f)    The ability of the spouse from whom maintenance is sought to meet his or her needs while meeting those of the spouse seeking maintenance.

As you can see, these factors are broadly defined, and judges have wide discretion to determine the amount of temporary alimony.  Therefore, it is important that you and your lawyer review all financial documents carefully and fully prepare for the temporary orders hearing.

This article is intended to serve as a very brief overview of the temporary alimony process.  You should consult with an attorney to find out how the law will apply to the facts of your case.  Call the Law Office of Kirk Garner today for your free thirty-minute consultation.

How Alimony Works in Colorado, Part 1.

Temporary spousal maintenance is designed to equalize the finances until the divorce is final.

Temporary spousal maintenance is designed to equalize the finances until the divorce is final.

Alimony is a payment of money from one spouse to another for the purpose of financial support or equalization of incomes. In Colorado, alimony is technically called “spousal maintenance.” There are two kinds of spousal maintenance: temporary and permanent. Temporary maintenance is the payment of money from one spouse to the other before the marriage has been dissolved (i.e., before the divorce is final). Permanent maintenance–what most people think of when they hear the term “alimony”–is the payment of money from one former spouse to the other after divorce.

In this article, I will discuss temporary maintenance when the spouses earn a combined annual income of $75,000 or less. In future articles, I will discuss 1) temporary maintenance when combined annual income exceeds $75,000; 2) permanent maintenance; and 3) other aspect of alimony, including modification, termination, and tax treatment.

Historically, the calculation of alimony has been very subjective. Based upon the same facts and income, different judges will regularly calculate and award different amounts of alimony. This creates a lack of certainty and predictability in the courts, and makes it hard for divorcing couples to plan for the future. To make the award of temporary maintenance more uniform, the Colorado legislature developed a guideline for couples whose combined annual income does not exceed $75,000. In these situation, it is a rebuttable presumption that for temporary maintenance (again, alimony paid before the divorce is final), the spouse with the higher income should pay an amount equal to forty percent of his or her income, minus fifty percent of the earnings of the spouse with the lower income.

Example #1. Let’s say that Bob earns an average of $4,000 per month, and Emily earns $2,000 per month. Forty percent of Bob’s income is $1,600, minus fifty percent of Emily’s income, which is $1,000, equal $600. Until the divorce is final, it is presumed that Bob should pay to Emily $600 per month.

Note first of all that this does not entirely equalize the spouses’ income: Bob is left with $3,400 per month, and Emily has $2,600. Secondly, while this formula adjusts income, it does not affect the payment of debts and expenses: the judge will still have to apportion which spouse will pay which monthly expenses. In many cases, the amount of expenses a party has to pay has a greater affect on their discretionary income than the amount of temporary maintenance they have to pay, or that they receive.

Example #2. Paul earn $1,000 per month, Lois earns $5,000. Forty percent of Lois’ income is $2,000, minus fifty percent of Paul’s income, which is $500, equals $1,500.  The presumptive temporary maintenance would have Lois paying Paul $1,500 per month.

Example #3. Sam earns $2,500 per month, Alice earns $2,000. Using the temporary maintenance formula, neither party would have to pay temporary alimony. (Forty percent of 2,500 is 1,000, fifty perent of 2,000 is 1,000. 1,000 – 1,000 = 0.)

It is important to keep in mind that this temporary maintenance formula (for combined income which does not exceed $75,000) creates a rebuttable presumption in favor of the calculated amount. That means that either party may seek a different amount of temporary alimony if they can show that the formula is somehow unfair. If you are able to persuade the Court, then the amount of temporary maintenance may be either higher or lower than the result of the formula.

In the next article, I will discuss how the courts calculate temporary maintenance when the parties have a combined annual income of more than $75,000. In future articles, I will discuss permanent maintenance and other aspects of Colorado’s alimony laws.

As you can see from this article, the law of alimony in Colorado is complicated and subjective. Contact the Law Office of Kirk Garner today to discuss whether you could be entitled to alimony; or find out how much you might have to pay your spouse.

Divorce in the News: Stay-at-Home Parents Are At Financial Risk During Divorce

A very interesting article in the Huffington Post this morning, written by divorce lawyer Beverly Willett, entitled, “Are Stay-At-Home Parents At Financial Risk During Divorce?“  Willett writes,

In practical terms, if the breadwinner leaves, the first risk faced is lack of immediate access to funds. Even if you have a joint bank account, your spouse might decide to open a new one in which to deposit paychecks. Joint stock or savings accounts may require joint approval for withdrawals. This could leave stay-at-home parents hostage for money until they are able to secure a temporary order of support as well as funds with which to defend themselves. For that, they’ll undoubtedly need to hire an attorney and pay a retainer, unless the lawyer is willing to wait.

Indeed, the non-working spouse is at the greatest risk when the divorce was not anticipated.  Unfortunately, most states have adopted no-fault divorce grounds, permitting one spouse to the union to seek divorce unilaterally, regardless of the other spouse’s wishes.  In Colorado, the cause of the breakup of the marriage is not admissible in the divorce.  Courts will not consider which spouse is at fault when weighing how to divide property “equitably.”  The benefits the innocent spouse expected to receive from the continuation of the marriage are not deemed relevant, even when it comes to the award of spousal maintenance.  Willett continues,

The financial risk stay-at-home parents face when it comes to alimony is even more troubling. When no-fault was instituted, permanent alimony awarded to spouses who had given up their careers to become stay-at-home parents began to fall out of favor, permanent alimony being deemed incompatible with the clean break idea behind no-fault.

Read the entire article.

For the time being, Colorado does make provision for spousal maintenance, otherwise known as alimony.  If you are an innocent spouse or stay-at-home parent, call the Law Office of Kirk Garner to set up a consultation to discuss your eligibility to receive alimony.