Colorado’s New Maintenance (Alimony) Formula

Introduction

There’s a big change coming to Colorado law in 2014 concerning maintenance (sometimes called “spousal support” or “alimony”). After decades of having maintenance determined on a case-by-case basis determined by the facts in each situation, the new maintenance law will allow judges to apply a maintenance formula when awarding maintenance for periods of time after the parties are divorced. The new maintenance law will be in effect on January 1, 2014, for cases filed on or after January 1, 2014.

Goals and Policies of New Maintenance Law

As explained in the new law, courts and litigants would benefit from the establishment of a more detailed statutory framework that includes advisory guidelines to be considered as a starting point for the determination of fair and equitable maintenance awards.

The goal behind the new maintenance formula law is to assist the court and the parties in crafting maintenance awards that are fair, equitable, and more consistent across the state.

Nuts and Bolts – How the New Maintenance Law Will Work

Here’s how the new law will work. When a party has requested maintenance in a dissolution of marriage (divorce), legal separation, or declaration of invalidity proceeding (annulment), prior to granting or denying an award of maintenance, the court shall make initial written or oral findings concerning:

1. the amount of each party’s gross income;
2. the marital property apportioned to each party;
3. the financial resources of each party, including but not limited to the actual or potential income from separate or marital property; and
4. reasonable financial need as established during the marriage.

After making the initial findings the court shall determine the amount and term of the maintenance award, if any, that is fair and equitable to both parties after considering:

1. the guideline amount and term of maintenance in the new maintenance formula, based upon the duration of the marriage and the combined gross incomes of the parties; and
2. the following factors:

• the financial resources of the recipient spouse, including the actual or potential income from separate or marital property or any other source and the ability of the recipient spouse to meet his or her needs independently;
• the financial resources of the payor spouse, including the actual or potential income from separate or marital property or any other source and the ability of the payor spouse to meet his or her reasonable needs while paying maintenance;
• the lifestyle during the marriage;
• the distribution of marital property, including whether additional marital property may be awarded to reduce or alleviate the need for maintenance;
• both parties’ income, employment, and employability, obtainable through reasonable diligence and additional training or education, if necessary, and any necessary reduction in employment due to the needs of an unemancipated child of the marriage or the circumstances of the parties;
• whether one party has historically earned higher or lower income than the income reflected at the time of permanent orders and the duration and consistency of income from overtime or secondary employment;
• the duration of the marriage;
• the amount of temporary maintenance and the number of months that temporary maintenance was paid to the recipient spouse;
• the age and health of the parties, including consideration of significant health care needs or uninsured or unreimbursed health care expenses;
• significant economic or noneconomic contribution to the marriage or to the economic, educational, or occupational advancement of a party, including but not limited to completing an education or job training, payment by one spouse of the other spouse’s separate debts, or enhancement of the other spouse’s personal or real property;
• whether the circumstances of the parties at the time of permanent orders warrant the award of a nominal amount of maintenance in order to preserve a claim of maintenance in the future;
• any other factor that the court deems relevant; and
• whether the party seeking maintenance lacks sufficient property, including marital property apportioned to him or her, to provide for his or her reasonable needs and is unable to support himself or herself through appropriate employment or is the custodian of a child whose condition or circumstances make it inappropriate for the spouse to be required to seek employment outside the home.

If those findings are made and if the findings support an award of maintenance, the formula will be considered by the Court. Basically, if the parties’ combined incomes are less than $360,000.00 annually and they have been married for at least three (3) years, the maintenance formula amount will be 40% of the monthly gross income of the higher earning spouse, less 50% of the monthly gross income of the lower earning spouse. The duration of the maintenance award varies with the duration of the marriage.

The maintenance formula (guidelines) do not create a presumptive amount or term of maintenance. The court has discretion to determine the award of maintenance that is fair and equitable to both parties based upon the totality of the circumstances. The court shall make specific written or oral findings in support of the amount and term of maintenance awarded pursuant to this section or an order denying maintenance.

Under the new law, the court may award additional marital property to the recipient spouse or otherwise adjust the distribution of marital property or debt to alleviate the need for maintenance or to reduce the amount or term of maintenance awarded.

Conclusion

The new maintenance (alimony) formula law will help guide judges when they determine how much maintenance should be awarded and how long the duration should be, while still leaving the final decision about maintenance in the discretion of the judge. Wives and husbands who are currently contemplating divorce prior to the effective date of the new law (that is, prior to January 1, 2014), should think about whether they want to wait before filing a divorce case – so that they can utilize the new maintenance law.