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What Is Considered Income When Deciding Child Support?

If you and your spouse share a child during a divorce, one of you may end up owing the other child support, depending on the custody and support arrangement. If you believe you will have to pay your ex-spouse child support after a divorce, it can help to understand how the courts in Colorado calculate child support amounts. Start by understanding what the courts consider income.

How Do the Courts Calculate Child Support in Colorado?

Child support is a legal decree ordering one parent to pay a certain amount to financially support a child after a divorce. In Colorado, the law holds that both parents should share financial responsibility for a child after a divorce. A judge may use a child support order to make each parent’s contribution to childcare equal – thus allowing the child of a divorce to maintain the standard of living he or she enjoyed during the marriage.

When determining a child support amount in a divorce case, a judge will analyze factors such as:

  • Both parents’ gross incomes
  • The financial resources of either parent
  • The custody arrangement
  • How much time each parent spends with the child
  • The needs of the child (medical care, education, etc.)
  • The financial resources of the child
  • The child’s standard of living before the divorce

It is possible to avoid having a judge determine your child support amount if you and your ex-spouse can agree to an amount on your own. If you and your ex-spouse can agree to a parenting plan, including custody, visitation and child support orders, a judge will most likely sign off on the settlement agreement if it is in the best interests of the child. Otherwise, your case will go to court in Colorado for a judge to decide.

What Is Considered Income?

It is important to understand exactly what the law considers income when determining a child support award. Under Colorado Revised Statutes Section 14-10-115, a parent’s adjusted gross income refers to his or her gross income minus pre-existing child support and alimony obligations. Income can refer to more than just the wages you earn at your place of employment, however. Income can refer to:

  • Wages
  • Salaries
  • Tips and commissions
  • Bonuses
  • Overtime
  • Nonmonetary employment perks
  • Severance pay
  • Pension plan
  • 401(k) account
  • Trust or estate income
  • Annuities
  • Workers’ compensation benefits
  • Unemployment benefits
  • Veteran’s benefits
  • Social Security benefits
  • Gifts and prizes won
  • Education grants
  • Alimony from another ex-spouse

Income refers to your actual gross income if fully employed or your potential income if you are underemployed. If you try to intentionally avoid employment to diminish what you will owe your ex-spouse in child support, the courts in Colorado will impute income to you. It will estimate your child support payment obligation based on what you reasonably could be earning according to your work history, education and other factors. You must then meet your assigned child support obligation, even if it means getting a higher-paying job.

How to Report Your Income During a Divorce Case

You must list all sources of income on the financial disclosure form you submit to the courts at the beginning of your divorce case. You are obligated by law to fully disclose everything that constitutes a source of income under penalty of perjury. This means if you knowingly hide any source of income, no matter how small, you could face criminal charges and serious consequences.

If you are not sure whether the courts classify a certain type of earning as income, consult with a divorce attorney. A Fort Collins divorce lawyer can carefully review your case to help you identify what the courts consider income. Your lawyer can help you negotiate a child support agreement with your ex-spouse, decreasing your chances of going to court, or represent you at trial. Hiring a divorce lawyer to represent you can protect you from making critical errors, such as failing to disclose something the courts consider income.

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