What Factors Determine Maintenance and Alimony?
Maintenance and alimony is determined in Colorado based upon several different factors. The first factor is looking at the gross income of the parties. In other words, there is a formula that is utilized. There is a formula that is available online, and I have the family law software. If you come in and see me, I can run a maintenance alimony where the terms are interchangeable, but basically, it’s a maintenance worksheet on the spot.
We look at the gross income of the parties, not the net income of the parties and then we also look at other factors. Ones that basically worksheet number has been determined, we look at need and ability to pay. We look at your need. If you are requesting maintenance, what is your need? Do you need the maintenance? Then we look at the other party’s ability to pay. Does the other party have the ability to pay maintenance and meet the other obligations that are required?
That’s it. Basically, a two part analysis. We look at the gross income of the parties. We put it on our worksheet. We see what the number is and then we look at need and ability to pay. Your sworn financial statement is going to come into play once you get into a disillusion of marriage proceeding because a sworn financial statement, basically outlined your everyday expenses and your debts, unsecured debts that you’re paying and it comes up with a short fall or a positive number for each month.
The courts utilize the sworn financial statement in conjunction with the worksheet that’s generated through the program to evaluate need and ability to pay. We also look at the number of months that you’ve been involved in the marriage. Whether you’ve been married for three years or more and other factors.
For example, if a party is paying a lot of credit card debt and handling that aspect, then perhaps, there’s not the funds available to pay maintenance. The other thing to keep in mind is that maintenance is taxable to the recipient under income tax and it is a tax deduction for the person who’s paying.
Perhaps you want to structure things a little differently if you’re concerned about a tax consequence, maybe you’re better off having the party, the income to party, the party with the income. Pay the house payment or pay the credit card debt in lieu of actually paying the maintenance. On the other hand, you might think to yourself, “I’m going to need to be able to qualify for a loan. Perhaps I need to buy a house and so I need to be able to report income on that loan application.” Well, maintenance is considered income for purposes of that loan application.
Maybe you do that incomes stream in order to be able to move forward with your life, be able to buy a home or a car. Here at Lewis and Matthews, during your initial consultation, we can run worksheets for you and give you an idea of what you’re entitled to under Colorado law and then we can talk about your unique situation and figure out the plan that’s best for you.