POST DIVORCE MAINTENANCE

In the state of Colorado, the term “post divorce maintenance” is what is often referred to as alimony or spousal maintenance in other states. It mostly applies to spousal support, but also encompasses child support obligations. Post divorce maintenance stays consistent for many people, but it also changes depending on the financial changes in the life of the spouse receiving maintenance. 

Because of the significant financial impact that divorce has on many people, it’s important to remember that an experienced Denver divorce attorney can help with post divorce maintenance obligations. Whether you’d like to receive or to alter the payments, Litvak Litvak Mehrtens and Carlton are here to help. Our firm handles all manner of complicated financial matters related to divorce and family law in Colorado. To arrange a consultation with us, please call 303-951-4506 or fill out our online intake form today.

Financial Obligations After Divorce

Financial responsibilities between spouses may remain after the divorce is finalized. One spouse may be required to pay the other spousal maintenance or child support on a monthly basis. Alternatively, a spouse may be compelled to keep insurance for the former spouse’s benefit. There may also be credit difficulties, tax issues, or other financial issues that will continue to affect you following your divorce. The sections that follow discuss the possibility of continuing financial responsibilities after the divorce has been finalized.

Spousal Maintenance, or Alimony

In some divorce cases, spousal support will not be granted. It is necessary to understand the objective of maintenance in order to determine when it will be required. The purpose of maintenance is to make the parties’ financial situations become more equitable. As a result, a significant economic gap between the spouses is generally necessary before maintenance is given. Depending on the circumstances, any spouse may be compelled to pay maintenance.

The court will award maintenance for the length and amount that the court considers just after considering all relevant facts. When it comes to establishing a maintenance award, the judge has a lot of leeway. Maintenance is therefore less predictable than other aspects of divorce law. Parties can enhance predictability by mediating or discussing any maintenance concerns with each other and their family law attorneys.

What Is Spousal Maintenance?

Spousal maintenance is another term for spousal support (or alimony). This money is given to one spouse by the other spouse. It can be ordered for a few months or for an unlimited period of time. It might be paid on a monthly basis, in a lump payment, or in a mix of the two. For both the spouse paying maintenance and the spouse receiving it, maintenance can have major tax consequences. As a result, you should consult with a tax specialist as well as your family law attorney about this matter.

Can I Modify Spousal Maintenance?

Any maintenance order can be changed unless there is an agreement to the contrary. The court must assess whether there has been a substantial change of circumstances before modifying maintenance. And, more particularly, that the parties did not anticipate the significant change in circumstances at the time the decree was issued. Parties might also ask the court to order a modification of maintenance that they have agreed to. If spousal support is not given at the time of divorce, the decree cannot be changed later to include it.

Health Insurance

The termination of health insurance that covers spouses and dependent children is prohibited by Colorado Revised Statutes 14-10-107 (4)(b)(I)(D). Furthermore, couples cannot let their insurance lapse by failing to pay their payments.

Only if both parties are given at least 14 days’ notice and both agree to the change in writing can couples alter or terminate health insurance coverage during a divorce. Otherwise, the requests for changes or cancellations are in violation of Colorado law.

While the law protects a spouse’s insurance coverage throughout divorce procedures, you’ll want to know how to get and keep health insurance thereafter before finalizing your divorce.

Life Insurance

Many spouses agree to retain life insurance to guarantee maintenance or child support responsibilities as part of their divorce settlement to provide financial assistance for their family members. The insured is the payor spouse, while the beneficiaries are the spouse or children who receive the support. If your case goes to court, the judge may require the payor spouse to keep or start a new life insurance policy to cover his or her support responsibilities.

If a court-ordered life insurance policy is included in your Decree of Dissolution of Marriage, by agreement, or by Permanent Orders, the policy owner must not only keep the court-ordered policy, but also refrain from altering the beneficiaries without first getting permission from the court. In addition, the policy owner must avoid the policy being delinquent or being cancelled due to payment failures. If one spouse fails to follow the conditions of a court-ordered life insurance policy, the other spouse can obtain a court order to compel compliance and impose fines.

Wills

The regulations governing wills and divorce in Colorado vary depending on when your will was drafted and whether you were married or divorced. If you divorce after making your will, your ex-spouse is immediately removed off the list of devisees (will not receive any assets from the estate). Your ex-spouse is likewise ineligible to be the executor of your will. If you marry after you make your will, your spouse may have statutory rights to a part of your probate assets that would otherwise be distributed according to your will. This is unless you update it to reflect your new desires. However, your ex-spouse may still inherit property or a pension plan inheritance in some situations.

Social Security

Social security contributions payable during marriage are marital, but the social security benefits ensuing are not marital. The provisions of “anti-alienation” specified by the 42 U.S. Code § 407(a) allow for the non-division of social security payments by State courts. Indeed, this legislation does not affect social security, other than taxes, student loans, or child support or alimony.

Effects on the Credit Score

Your credit score may be harmed by several issues relating to divorce. Joint accounts influence how your score swings as your former spouse’s financial activities cannot be monitored. Below, we include common reasons why you might see a lower credit score after a divorce.

• Although it may sound ridiculous, an ex who feels scorned or offended might unfairly pursue vengeance. One method of revenge to try ruining your credit score. You may have huge debt under your name, if your ex gets access to your credit account. For any loans or charges on your account, you will be liable for them.
• When you go from two to one income, it might be challenging to maintain the lifestyle you’re accustomed to. You could still be hurting from the divorce’s financial toll. This might lead to missed credit payments, which can have a bad impact on your credit score.
• If you and your ex share responsibility for a joint account, it’s critical that you both pay your bills on time. If your ex isn’t as concerned about their credit as you are, they may be willing to let payments slide. Both of your credit scores will suffer as a result of this.

Divorce and Bankruptcy

It’s crucial to grasp the term “domestic support obligation” for bankruptcy purposes, because such obligations are excluded from most of the bankruptcy code’s safeguards. In brief, a domestic support obligation is defined as a debt, plus interest, as defined by 11 U.S. Code 101(14A).

Child support or alimony arrears are referred to as a “domestic support obligation”, to put it plainly. However, payments to compensate for a discrepancy in the division of the marital estate (i.e., a property equalization payment) are not considered domestic support. And it is federal law, not state law, that determines whether a debt is covered by this clause. Even if the payment was owed to a third party, it would constitute a domestic support obligation if the aim of the payment was to support the other spouse or child.

Divorce and Taxes

Even after a divorce, Colorado statutes provide that one spouse may be obligated to financially support the other spouse. Maintenance, also known as alimony or spousal support, is considered regular income and is taxed to the payee, or the person who receives the payments. This means that the spouse receiving spousal assistance from a previous spouse will have a new tax burden or obligation. It’s probably in your best interest to consult with a tax professional regarding these matters.

It’s a common misconception that the custodial parent may always deduct the children from their taxes. This isn’t the case in every situation. If the spouses cannot agree, Colorado law states that the court will decide who has the right to claim a kid as an income tax dependent. This exception is divided between the parents in proportion to their contributions to the costs of child rearing. This might be a source of contention that should be handled through the courts or through a separation agreement. Child support is not tax deductible, which means that it will not be recognized as a deduction on your income tax return.

Child Custody and Child Support

In Colorado, child custody or visitation, as it is more generally known, is referred to as “parenting time.” The schedule of the days the parties’ children spend with each parent is referred to as parenting time. When deciding parenting time, the court looks for a timetable that is in the children’s best interests. The court considers a number of criteria, including the ones listed below.

• The wishes of the parents
• Child’s relationship with each parent
• Child’s connection to the home, school, and community
• Whether or not the parents are capable of fostering love and contact with the other parent
• The past patterns of each parent’s involvement with the child

Child support is a monetary payment made by the noncustodial parent to the custodial parent. This contribution is intended to help with the upbringing and care of a mutual child. The state of Colorado has made this a legal requirement, based on the concept that all legal parents have a responsibility to support their children. This is true whether the parent has physical or legal custody of the child. In other words, regardless of their circumstances, parents in Colorado are required to pay child support.

Many states recognize child support as a legal right, but Colorado goes a step farther and acknowledges it as a human right of the children. The courts may refuse to acknowledge agreements between parents that are less than what the “Child Support Guidelines” indicate. Those rules include calculations for calculating how much the family would have spent on the child’s care had the parents not divorced.