Alimony Payment Terms and Methods
Attorneys Experienced in Spousal Support Issues
Alimony (or spousal support) is designed to help a spouse with insufficient financial resources provide for their reasonable needs during and after a divorce. However, there is no automatic entitlement to alimony in Colorado. Instead, the court usually follows advisory guidelines to determine both the amount and how long the maintenance will be paid. If you are concerned about alimony payment terms and methods, the experienced Denver alimony attorneys at Plog & Stein, P.C. are ready to offer knowledgeable legal representation. With over 70 years of combined legal experience, our only goal is the best possible outcome in your family law case.
Understanding Alimony Payment Terms and Methods
The advisory guidelines set forth in C.R.S. 14-10-114 are intended to help calculate how much alimony should be paid when a marriage was 3-20 years long and the annual combined income is under $360,000 per year. They provide a baseline for determining how much maintenance (alimony), if any, should be awarded. However, the judge still has the discretion to make an award that takes into account factors such as marital property, each spouse’s income, and each spouse’s financial resources. The guidelines are not binding.
When a family has an income of $360,000 or more, a judge has even greater discretion. The judge will consider such factors as how long the marriage lasted, the standard of living during the marriage, whether there are small children or disabled children from the marriage, the parties’ incomes, which property was awarded to each party, each spouse’s earning potential, and caregiving roles. When a marriage is more than 20 years, the guidelines are also of limited use because they rely on a timetable based on marriages that have a duration of 20 years or less.
Alimony is considered taxable income for the payee and is tax deductible for the payer. Additionally, if alimony is awarded to the party who is receiving child support, the alimony award becomes income for the payee and may affect the child support award.
Whether it is determined by an agreement between the divorcing spouses or a court order, alimony may be temporary or permanent in nature. Temporary alimony is awarded while the divorce is pending. This is awarded so that a non-earning spouse can continue to handle expenses when the earning spouse leaves. Permanent alimony, despite the name, is not necessarily alimony that is “permanent.” It is permanent in the sense that it is incorporated into the permanent final order and lasts for a specified duration until the recipient remarries, or until either spouse dies. In some cases with extremely long marriages and elderly parties or a disabled spouse, lifetime maintenance is possible.
In terms of payments, the majority of maintenance orders will entail a monthly payment from one spouse to the other. Payments can be made directly, whether via check, direct deposit, or some other form of transfer. Payments can also be made through a wage garnishment (Income Withholding Order). In this situation, the monthly payments are garnished from the payer’s income and either sent directly to the recipient or paid through the Family Support Registry. The Registry is a state-run holding tank into which payments are made and then disbursed to the payee. Your attorney can help you determine which scenario best suits your needs. Keep in mind that if the recipient requests an IWO he or she will likely be granted one. For payers, we recommended keeping record of all payments during the alimony term and avoiding making cash payments.
Maintenance orders are formulated either via settlement between the parties or via a court order handed down by a family law judge at a hearing. In most cases, the court retains jurisdiction over the issue of alimony as relates to both enforcement of orders and modifications. However, when parties are formulating divorce settlement agreements, they can agree to make the alimony contractual and non-modifiable. In this type of arrangement, the parties generally agree that the court is divested of any jurisdiction to modify the maintenance provisions. An agreement may also include specific terms as to how and when payment is to be made and under which circumstances it will be changed, if any. Unless the maintenance orders are contractual and non-modifiable, they will automatically terminate upon remarriage of the payee or the death of either party, as per statute. When entering into a contractual maintenance agreement, it is important for the payor to make sure he or she includes language tied into remarriage. It’s also important to make sure lesser provisions tied into maintenance are also made part of the “contract.”
With income tax implications tied into maintenance for both parties, it’s important to make sure your orders are structured so as to comply with IRS Code. Making lump sum payments, payments of property in lieu of maintenance, or irregular payments may divest the payer of the right to deduct the maintenance. Payment of other expenses as part of a maintenance obligation may be deductible in certain situations and if specified as “alimony” in your orders. If you are considering an alimony arrangement which entails something other than a regular monthly or another payment schedule it is advisable to consult with a tax attorney or certified public accountant, in addition to your Denver divorce attorney.
Experienced Lawyers Serving Denver and Surrounding Communities
At Plog & Stein, P.C., we understand how challenging divorce may be for our clients, and we assist them through experienced and outcome-oriented representation. If you are hoping to learn more about alimony payment terms and methods in Colorado, you should call our attorneys. We offer full representation in court cases, as well as unbundled legal services for people in need of legal help but not fully ready to hire a lawyer. Contact us online or call Plog & Stein, P.C. at (303) 781-0322 for an appointment. We also represent people who need a child support lawyer or assistance in other family law matters in Parker, Castle Rock, Highlands Ranch, and Aurora, as well as other areas of Arapahoe, Douglas, Jefferson, Adams, and Boulder Counties.