CHILD SUPPORT’S JUST A FORMULA, RIGHT? HOW HARD CAN IT BE? (Part 5)

More of the most common issues that I see when calculating child support:

Overtime Income

When a parent’s income includes overtime, parties often argue about whether the overtime income should be included in calculating child support.  One part of the Colorado child support law states that overtime pay is included as income only if the overtime is required by the employer as a condition of employment.  In essence, this means that if the parent can turn down the chance to work the overtime, it’s generally not included in the income figure used for child support. 

However, as I discussed in my Child Support blog #3, another part of the Colorado child support law states that a court may (not shall) deviate from the child support guideline formula if there is consistent overtime not considered in the income figure used to calculate child support.  

In practice, this means that the court cannot mathematically include the voluntary overtime income of a parent when it enters that parent’s income into the child support calculation.  However, once the court has produced the child support figure resulting from the calculation, the court can then adjust that child support figure up or down as it deems fair because a parent has consistent voluntary overtime income.

Income from Second Jobs

If a parent is employed full-time and voluntarily chooses to take a second job, the income from the second job is not included in that parent’s income when calculating child support.  The Colorado legislature doesn’t want to punish a parent who seeks to make more income by working a second job, so it excluded second job income from child support calculations.  Note: if the parent is employed less than full-time at his/her first job, it’s likely that either the second job income will be included, or the parent will be imputed full-time income at the first job.

However, just like voluntary overtime (and as I discussed in my Child Support blog #3), a parent’s income that is more than full-time or is from second jobs can be considered as a reason to deviate from the child support guidelines.  

CHILD SUPPORT’S JUST A FORMULA, RIGHT? HOW HARD CAN IT BE? (Part 4)

In earlier blogs, I’ve discussed some of the challenges that arise when calculating child support, especially when it comes to determining the correct income to use.  Here’s another issue that I often see.

Bonus and Commission Income

Colorado law says that bonuses are income to be included when calculating child support (typically averaged over 12 months and added to the regular monthly income).  In my experience, this is one of the most contentious issues, especially where bonuses are discretionary by the employer. 

A parent who received a bonus one year is often concerned that, if the bonus is included in income, he/she won’t receive a bonus the next year.  The other parent is concerned that if the bonus isn’t included, and the other parent does get future bonuses, the child support figure is unfair because it’s based on income that is too low.  Another concern can arise when the bonus is a one-time annual payment, but the monthly child support payment is based on the bonus being averaged over the year (even though not received monthly).

Under Colorado law, commissions are also income to be included when calculating child support (also usually averaged over 12 months and added to the base monthly income).  The parent with the commission income can be concerned because, although their commissions may vary from month to month, the child support is a set monthly amount.

These are perfect situations for resolution through mediation.  Judges are bound by the law and often don’t have the flexibility to account for these type of circumstances in calculating child support.  In mediation, parents can get much more creative and case-specific. 

I often help parents craft agreements where there is a base monthly child support amount, and then bonuses and/or commissions are shared as received (sometimes through a quarterly settle-up).  That way, a parent isn’t paying child support based on income that he/she doesn’t have, but the other parent is getting the child support benefit when/if that additional income is received.

CHILD SUPPORT’S JUST A FORMULA, RIGHT? HOW HARD CAN IT BE? (Part 3)

Deviation from the Child Support Guidelines

As I discussed in my first blog regarding child support, Colorado child support is calculated on a formula.  This formula is often called the child support guidelines.  Many people believe that these guidelines are absolutely required to be applied, with no wiggle room. 

Although it’s true that in most cases the courts follow the child support guidelines, the law does allow the court to deviate from the child support guidelines. The standard for deviation is that the application of the guidelines would be “inequitable, unjust, or inappropriate.”   If the court deviates, the court is required to determine what the child support would have been under the guidelines, and then give detailed reasons for the deviation.

Reasons that may (not shall) justify deviation from the child support guidelines include, but aren’t limited to:

  • one parent spends substantially more time with the child than reflected by a straight counting of overnights;
  • extraordinary medical expenses incurred for treatment of a parent or a current spouse;
  • extraordinary costs associated with parenting time;
  • gross disparity in income between the parents;
  • ownership of a parent of a substantial non-income producing asset;
  • consistent overtime not included in the gross income of a parent in the child support calculation (explained more in my next blog); and
  • income that is more than full-time or is from second jobs (explained more in my next blog).

The existence of one of these factors does not require the court to deviate from the child support guidelines, but may be used as a factor in a court’s decision to deviate.  The court can still deviate from the child support guidelines even if one of the above factors does not exist.  However, for any deviation, the court must state what the child support would have been under the guidelines, and then explain its reason for the deviation. 

Check out Part 1 and Part 2 in this series on child support in Colorado.