Tag Archives: parenting

Child Support and Taxes

Tax season is upon us and I’ve been getting a lot of questions about child support and taxes. First, Colorado child support is generally not taxable. Unlike maintenance/alimony, the payor of child support cannot deduct paid child support from their taxable income. Similarly, a parent receiving child support need not report that money on their tax return.

Second, a minor child can be claimed as a dependent on a parent’s tax return. Who gets the dependency exemption? Pursuant to C.R.S. 14-10-115(12), the Colorado court is required to allocate the right to claim a child as a dependent in proportion to the parents’ contributions to the costs of raising the child. If a mother has more parenting time than the father and she pays for the child’s sports, tutoring, health insurance, daycare, etc., the court will likely give her the right to claim the child as a dependent.

Nevertheless, the parties can always voluntarily agree on which parent gets to claim a child in a particular year. Although Colorado has done away with the term “custody” in favor of “parenting time,” the IRS predictably is behind the times. The “custodial parent” matters for IRS purposes and is defined as the parent with the most overnights. Because there are an odd number (365) of days in a year, one parent will almost always have more than the other even when they are “50/50 parents” or have “equal time.” That parent is then the “custodial parent” under the current IRS regs and the one eligible to claim the child as a dependent. There are times when the IRS regs conflict with the Colorado law on who gets to claim the child as a dependent. As a result, it is usually a good idea for parents to sign IRS Form 8332 along with their divorce or allocation of parenting rights agreements to ameliorate any issues down the road if the parties agree to split the right to claim a child on future tax returns.

In addition to the dependency deduction, the current tax code allows for a separate deduction for work-related day care and a credit (different from a deduction) for each child. The rules on those deductions and credit are complex because they hinge on the taxpayer’s income and other factors. Tax laws change all the time and my advice is always for a client to consult with a CPA or tax attorney before signing a deal.

Although parties going through a Colorado divorce or dispute over parenting rights often times will disagree about the color of the sky on particular day, there are times when it makes sense for them to strategically work together on taxes. For example, if one parent cannot benefit from the tax credit because they make too much money, they can offer to give the other parent the right to claim that child and split the amount of the credit. It results in a “win-win” for both parents. It is rare to characterize anything as a “win-win” in a Colorado divorce or when discussing anything related to taxes, but it is possible if the parties have thoughtful divorce lawyers and CPAs.

Parental Relocation in Child Custody Battles – Part III

This is the third installment on our series about Colorado relocation or “removal” cases.  We first kicked things off by discussing ski racer Bode Miller’s contentious child custody battle and how it relates to Colorado’s legal framework for when a parent wants to move away from the other parent. Next, we looked at the seminal Colorado case from 2005, Spahmer v. Gullette, and relocation cases that occur when a court is allocating parental responsibilities for the first time. Below we deal with cases where a party wants to move after a divorce has been finalized.

The case on point for post-decree relocation cases is In re Marriage Ciesluk. In contrast to Spahmer where the Court must assume that a parent has already moved, Ciesluk allows a trial court to order a parent stay put in their existing place. Spahmer and Ciesluk were decided by the Colorado Supreme Court on the same day in 2005. To fully understand the differences between how pre- and post-decree cases are decided, Spahmer and Ciesluk should be read together. We’ve discussed Spahmer before so let’s shift our focus to Ciesluk.

In Ciesluk, the parents finalized their divorce shortly before mother filed a motion to relocate to Arizona with the parties’ little boy. The trial court denied mother’s motion to relocate on the basis that her move would harm the boy’s relationship with his father. The trial court relied heavily on an article by Sanford Braver. In doing so, the court effectively created a presumption in favor of the father.

The Colorado Supreme Court upheld the trial court’s application of the relocation statute, C.R.S. 14-10-129(2)(c), but found that the trial court unconstitutionally infringed on the mother’s right to travel by creating a presumption in favor of the father. The Supreme Court held that the relocation statute puts both parents on a level playing field by not assigning a burden to either parent.

Under Ciesluk, a trial court must consider the factors set forth in the relocation statute in addition to the statute on the best interests of the child under C.R.S. 14-10-124. The factors for C.R.S. 14-10-129(2)(c) are listed below.

  1. The reasons for relocation with the child;
  2. The reasons the opposing party is objecting to the proposed relocation;
  3. The history and quality of each party’s relationship with the child since the entry of any previous parenting time order;
  4. The educational opportunities for the child at the existing location and at the proposed new location;
  5. The presence or absence of extended family at the existing location and at the proposed new location;
  6. Any advantages to the child’s remaining with the primary caregiver;
  7. The anticipated impact of the move on the child;
  8. Whether the court will be able to fashion a reasonable parenting time schedule if the change requested is permitted;
  9. Any other relevant factors bearing on the best interests of the child.

These factors undoubtedly result in a much more robust analytical framework when compared to a pre-decree (Spahmer) case. And many divorce attorneys believe that there is a bright line between pre- and post-decree cases. That’s understandable if Spahmer and Ciesluk are merely skimmed.

However, the line is blurred when Spahmer and Ciesluk are closely examined. We’ll discuss what lines of argument are possible in our fourth and final post on Colorado relocation cases.

Parental Relocation in Child Custody Battles – Part II

Bode Miller can take his son to the Winter Olympics in Sochi, Russia during the pendency of his child custody dispute. That sort of agreement would be unlikely in a Colorado case where one parent wanted to permanently relocate. The obvious difference in Bode’s situation is that he’ll be returning to the U.S. after the Games.

Speaking of differences, the last time I wrote about parental relocation I mentioned that there was a significant difference in Colorado between a pre- and post-decree relocation dispute. What are they? The short answer is that it is easier for a parent wanting to relocate before a court issues a final order (decree) allocating parental responsibilities versus after.

In Bode Miller’s case, the court has yet to finalize anything. Yes, he can go to the Olympics with his son. But that agreement was recently approved by the court as a “temporary order.” An agreement or judicial determination on where the child will permanently live has yet to be made. Miller and the mother, Sara McKenna, are still in an unsettled state. They can’t even agree on what to call the child – Miller calls him “Nate,” McKenna calls him “Sam.”

The uncertainty of Miller’s situation exemplifies one of the reasons why the Colorado Supreme Court held that a trial court must accept the location where each parent intends to live during the initial determination to allocate parental responsibilities. The name of that case is Spahmer v. Gullette. The Colorado Supreme Court reasoned that parents are on equal ground when initially determining parental responsibilities such as a divorce. For example, neither Miller nor McKenna has definitive parenting time or decision-making authority yet — indeed, that is the end result of the action itself.

In contrast, after a divorce (or an order is issued for unmarried parents) is finalized, each party has vested parenting rights. If one parent wants to move, it will undoubtedly reduce the other parent’s legally-recognized rights. Moreover, there is a degree of stability achieved for the child after a decree setting a parenting schedule has been issued. We’ll examine post-decree relocation cases in detail later, but it helps to understand the basis for Spahmer.

Spahmer requires everyone involved – the judge, attorneys, parties and any expert parent evaluators – to view the situation through an overly simplistic lens. The parent intending to move cannot leave the state with the child during the pendency of the case unless they have permission from the other parent or there is an extraordinary circumstance that would justify a court order. McKenna gave Bode Miller permission to take their son to the Olympics because she knew he’d return home. For a parent intending to permanently move, the risk of allowing them to travel out of state with the child is that they will never come back. Therefore, Spahmer results in a legal fiction where both parents are physically in Colorado, but one parent is looked at as if they’ve already moved.

So what does the Court consider when dealing with a Spahmer case? The “best interests of the child.” The statute, C.R.S. 14-10-124, for the best interests of a child explicitly contemplates the following factors:

  1. The wishes of the child’s parents as to parenting time;
  2. The wishes of the child if he or she is sufficiently mature to express reasoned and independent preferences as to the parenting time schedule;
  3. The interaction and interrelationship of the child with his or her parents, his or her siblings, and any other person who may significantly affect the child’s best interests;
  4. The child’s adjustment to his or her home, school, and community;
  5. The mental and physical health of all individuals involved, except that a disability alone shall not be a basis to deny or restrict parenting time;
  6. The ability of the parties to encourage the sharing of love, affection, and contact between the child and the other party; except that, if the court determines that a party is acting to protect the child from witnessing domestic violence or from being a victim of child abuse or neglect or domestic violence, the party’s protective actions shall not be considered with respect to this factor;
  7. Whether the past pattern of involvement of the parties with the child reflects a system of values, time commitment, and mutual support;
  8. The physical proximity of the parties to each other as this relates to the practical considerations of parenting time;
  9. The ability of each party to place the needs of the child ahead of his or her own needs.

Arguably the above list opens the door to a discussion about the difference in crime rates, schools, familial support, jobs, and cost of living between the new and existing locations. For example, a parent who wants to stay in Aspen would inevitably cite the quality of schools. In contrast, a soon-to-be single-mother in Vail will justify her planned move because she’ll have the support of her family in a less expensive place like Denver or elsewhere.

As we’ll see next time, those sorts of arguments may not come in under the simplistic analysis of Spahmer because they’re explicitly reserved for post-decree relocation disputes under C.R.S. 14-10-129.

Parental Relocation in Child Custody Battles

As noted previously, Bode Miller’s ongoing child custody saga provides a good backdrop to analyze Colorado law for relocation cases. A brief summary of Miller’s situation is necessary.

Miller and Sara McKenna briefly dated in the spring of 2012 in California. She got pregnant in May, which, coincidently, was the same month that Miller married another woman. McKenna decided to go to college and sent Miller a text in October: “Just a heads up, I met with an advisor from Columbia [in NYC] today and we will probably be moving there in the fall.” Before the baby was born, Miller filed a “Petition to Establish Parental Relationship” in California. McKenna moved to New York in December when she was seven months pregnant. Their son was born in New York and the legal wrangling over custody began.

While there are complicating jurisdictional issues between New York and California in Miller’s matter, at its core, the case is about a parent’s right to relocate with a child. These types of cases frequently come up in divorces or general child custody disputes in places like Aspen or Vail because of the high cost of living. Parents going through a divorce realize that living alone is more expensive and challenging in terms of a work-life balance. Often times a parent will determine that moving closer to family or a less expensive area is necessary even though it will result in the other parent having significantly less time with the children.

In Colorado, relocation cases are separated into two distinct categories: (1) initial allocation of parental responsibilities and (2) post-decree modifications. For example, the analysis for a mother going through a divorce in Vail who wants to relocate to New York City is different than the same mother who wants to leave Vail five years later.

The former situation — where a parent is going through an initial allocation of parental responsibilities — is guided by Spahmer v. Gullette and C.R.S. 14-10-127. The latter — a post-decree relocation — is controlled by In re Marriage of Ciesluk and C.R.S. 14-10-129. The differences between how a Colorado court deals with these two scenarios will be the subject of my next substantive post.

Bode Miller’s Custody Battle

The New York Times has a good article about Bode Miller’s recent custody battle. The case surveys a couple of issues – relocation of a parent and jurisdiction in Family Law – that will be covered in more detail in upcoming posts.

[Update on 12/1/2013: A New York court reversed course last week and ordered Miller to return his 9-month old son to the boy’s mother. There is an upcoming hearing on December 9.]

The Cost of a Divorce

Interesting article on the cost of divorce online at the Washington Times. According to the article, Avvo performed a survey of consumers and attorneys on the priority of concerns of those going through a divorce. The cost of divorce was #1.

As the author points out, it is nearly impossible to predict the cost of a divorce. An attorney has little control over the other party, the judge, or the opposing attorney. If children are involved, the cost of a divorce in Colorado is generally higher. Similarly, the costs rise dramatically when a parent wants to relocate, a party tries to hide assets or income, especially if they are self-employed, or the parties cannot be civilized and communicate on simple issues.

Each divorce is different. For those considering a divorce in Colorado, I suggest they at least consult with an attorney about their options before filing a petition and, especially, before signing a parenting plan or separation agreement. Most family law attorneys do not charge for initial consultations, and some offer unbundled legal services. Having a lawyer review a final agreement, or represent you for one hearing, is money well spent because it reduces the risk of issues coming up in the future. As in all walks of life, you get what you pay for.

Colorado Civil Union Act: Is there a difference between a civil union and marriage?

The Denver Post has a fairly extensive article covering the recently-passed “Colorado Civil Union Act” that’s headed for Governor Hickenlooper’s desk. As the Denver Post headline notes a civil union for a same-sex couple is different from marriage. That difference is non-existent for Colorado domestic-relations law.

The Civil Union Act provides that a civil union in Colorado will be treated essentially the same as marriage for purposes of a dissolution, separation or annulment. For example, a same-sex couple contemplating a civil union can enter into a pre-nuptial agreement. See C.R.S. 14-15-108. Colorado case law interpreting marital agreements will apply to agreements relating to civil unions. C.R.S. 14-2-307.5. And a divorce between same-sex couples will be treated the same as a dissolution of marriage of a man and woman in Colorado. See C.R.S. 14-10-106.5 & 14-15-115.

Nevertheless, we will have to wait and see whether the Colorado courts interpret the Civil Union Act differently for purposes of parenting rights, disposition of property, maintenance and the like. There will likely be some unintended consequences and wrinkles in the law that will crop up in the future.

The other interesting legal issues are noted below:

·         There’s a privilege for communications between same-sex partners. See C.R.S. 13-90-107.

·         Same-sex partners are now entitled to damages for wrongful death, emotional distress and other personal-injury claims. 

·         Probate and estate-planning aspects for civil unions are also treated fairly similar as a marriage between a man and woman.

·         A right to claim a homestead exemption or seek protection against attachment, execution and garnishment of property.

UPDATE (March 21): The Civil Union Act was signed into law today by Governor Hickenlooper.