How is alimony calculated in Colorado?

How is alimony calculated in Colorado?

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One question many couples have about divorce is whether the court will order one spouse to pay the other alimony, which is known as spousal maintenance in Colorado.

Unfortunately, there is no easy answer to this question since spousal maintenance awards largely depend on the specifics of each case. A court may examine a wide range of factors within the maintenance statute when determining whether maintenance is appropriate or not.

For instance, under current Colorado law, if a couple has been married for at least three years, but less than 20 years, the court may use statutory advisory guidelines to determine alimony amounts and duration. The Court may award maintenance in short-term marriages of less than three years when it is equitable to do so. In some cases, when the duration of the parties’ marriage exceeds twenty years, the court may award maintenance for a specified term of years or for an indefinite term.

Typically, when these guidelines are applied, maintenance payments will equal forty percent of the parties’ combined monthly adjusted gross income minus the lower income party’s monthly adjusted gross income. These payments would typically continue for a period of time set out in the guidelines. However, it is worth pointing out that these guidelines may not apply if the couple’s combined income is more than $240,000, or if they were married for less than three years (or more than 20 years).

It is also important to remember that the information above is simply a general outline of maintenance laws in Colorado. Depending on the circumstances, several other factors and/or statutory provisions may come into play, not to mention that laws can change at any time.

This is why it is always best to speak with an experienced family law attorney if you have any questions about alimony/spousal maintenance.

Does Alimony Ever End in Colorado?

Now that we have discussed how the amount of alimony is determined, the next question is when does it end?

Like most issues that must be resolved during a divorce, the answer to this question depends on several variables, the most important of which is the length of the marriage.

If the couple’s marriage lasted for at least three years, but less than 20, the court will likely determine the duration of alimony using a set of statutory guidelines. However, these guidelines are only applicable if the couple’s combined annual adjusted gross income is not greater than $240,000.

That said, if your combined income is $240,000 or less, alimony duration will be determined in whole months based on the length of the marriage. For instance, if you were to examine the alimony guideline table, you would see that maintenance would be awarded for 21 months if the marriage lasted for five years (60 months).

Additionally, the longer the marriage, the longer alimony is ordered, both in actual months and in proportion to the length of the marriage. For example, as mentioned above, a 5-year marriage would result in 21 months of alimony, which is a period of time equal to 35 percent of the marriage length (21 months/60 months).

Alternatively, if the marriage lasted 10 years (120 months), alimony would be ordered for 54 months, which is equal to 45 percent of the marriage length (54 months/120 months). Ultimately, these guidelines continue until 240 months, which is 20 years.

Once a marriage is longer than 20 years, however, the court has the discretion to order alimony for an indefinite term or for a specific number of months, although it cannot order it for a term that is less than 120 months unless it issues specifics finding that support this reduced amount. The court also has discretion when it comes to marriages of less than three years, and, in some cases, may not even award alimony when marriages last less than 36 months.

Of note, maintenance may be modified when there is a substantial and continual change of circumstances that make the award of maintenance unjust and unfair. Also, maintenance terminates by death of either party or remarriage.

What is an Alimony and Maintenance Trust in Colorado?

In some cases, parties are unwilling to make their support payments to ex-spouses. For those who believe they may face this problem if they pursue a divorce, it may be wise to protect against such a situation proactively.

One method of guaranteeing that a person cannot simply refuse to make support payments is to create an Alimony and Maintenance Trust. These are useful in protecting a payee spouse against lapsed payments by the payor spouse, which can result from a willful refusal to pay or because of a reduction in income. These legal mechanisms, which are also called Section 682 Trusts, are funded with assets from the payor spouse, which will then generate the money that is used to make maintenance payments.

Divorce planning that incorporates an Alimony and Maintenance Trust can be instrumental and beneficial in some circumstances. Still, they do carry some consequences, and should therefore probably be discussed with an attorney and tax professional before making any legal commitment.

Divorces are rarely pleasant events, and the introduction of asset division and alimony payments can sometimes cause future rifts if parties refuse to make their required payments. For this reason, those who are considering a divorce and believe their ex-spouses may create issues regarding property division and alimony payments may wish to consult with a Denver divorce lawyer to discuss precautionary legal options.