Why So Extra about Extra-Ordinary Expenses?
Child support in Colorado family law cases has long been calculated off formulas that attempt to distribute basic child-related monthly costs as if parents were still living in the same household. Parents in divorce, legal separation, juvenile or parental responsibilities (custody) cases use state-approved Child Support Worksheets, inputting the number of overnights spent with each parent, each parent’s monthly income before taxes, costs for parents’ work or education-related childcare, insurance premiums for the children and other agreed-upon or court-ordered expenses. The philosophy behind this streamlined approach is to ensure consistent and fair support orders across the state for children’s ordinary needs.
The result of the formulas is a legal presumption, and courts must make specific findings to justify deviations from the Worksheet’s recommended amount. The Worksheets apply in all cases where the parents’ combined gross income is $360,000 per year or less – in other words, in most cases. Parties may argue over a Worksheet’s inputs, but the formulas remain consistent. Even high-income parents are still required at a minimum to maintain the uppermost level of presumptive monthly support, i.e. the Worksheet formula’s result for a combined pre-tax income of $30,000 per month, as part of a more holistic analysis into their children’s needs – for these couples, monthly child support amounts less than the Worksheet’s resulting amount at $30k of combined gross income are considered deviations requiring specific, detailed reasoning which a judge may or may not accept as valid. All child-related agreements, including for financial support, must be approved by a judicial officer before they have legally binding effect.
Less understood are “extra-ordinary” child-related expenses – if parents want, they can include an average monthly cost for such expenses as part of the Worksheet’s inputs or they can agree to a separate shared payment arrangement as such costs arise – these costs are then considered “off-the-Worksheet” expenses. Parents must exchange documentation of extra-ordinary child-related expenses once a case is filed. Unlike food, shelter, clothing and transportation costs, they are not “ordinary” as they fall under categories of expenses beyond a child’s basic needs. Easily ascertainable extra-ordinary costs, like private school tuition, some recurring medical costs like unreimbursed prescription co-pays and annual/one-time activity fees can simply be allocated on the Worksheet which automatically redistributes costs based on each parent’s respective percentage of their combined gross income. Other activity fees or expenses that are hard to predict, such as travel costs and activity fees for sports which fluctuate depending on the team’s performance, or unpredictable medical needs for a special-needs child, may be more appropriate to handle off the Worksheet.
For many former couples, these expenses comprise the bulk of “child support” as it is commonly understood. Especially as children enter middle and high school, payments for expensive extra-curriculars (musical instruments, club sports, private supplementation to intraschool activities, tutoring and college prep and testing costs) can become especially contentious, given that the law only requires parents to pay their share of agreed-upon extracurricular activities. Without a carefully crafted Parenting Plan, this can perversely result in a parent reneging on payments by simply stating “I no longer agree” to the extracurricular activity or cost in question, potentially thrusting the entire financial burden for the expense onto the other parent.
Parents whose children are currently (or likely to be) involved in costly activities or have above-average medical needs are well served by entering into detailed agreements – for example, does an agreement to share in their child’s “violin lessons” include the costs of the instrument along with private instruction, repairs, summer music camp and other music-related travel costs, sheet music, etc., or are the parents limiting their agreement to share only in the costs of a private instructor? And if so, how often? What if the child needs to switch teachers? What if the child no longer wishes to play violin but one or both parents are highly insistent that continuing the activity is in the child’s best interests? How much weight should the child have in these decisions? Are there family trusts or other financial vehicles available to the child to offset either parent’s costs?
Similar issues arise with extra-ordinary medical expenses, which are defined as uninsured/unreimbursed medical expenses after parents pay $250 each towards these expenses in any given calendar year. Does this include orthodontia? What about elective procedures? Are vitamins and supplements to be included on top of prescribed medications? What about therapy or counseling? Colorado’s child support statute recognizes “reasonable costs” for payment of asthma treatments, physical therapy, vision care, orthodontia, etc., that are “reasonably necessary,” without offering further guidance. What one parent deems to be an eminently reasonable expense may be viewed as superfluous by the other.
Compounding the problem is the constant need to account with the other parent, given the logistical reality that most extra-ordinary expenses are paid in full and at once by one parent or the other – many organizations do not accept piecemeal payments from individual parents, and medical providers rarely bill each parent for their respective percentage share separately. Relatively amicable couples may rely on software or smartphone apps to help them, or may have a shared expenses tracker, such as a mutual Google Doc, with an agreement to true-up such expenses once a month or twice a year, every quarter, etc., and a deadline for the non-paying parent to reimburse the other. Arrangements like this require excellent record-keeping skills. To the extent that high-conflict couples cannot work with each other, they can also resort to the use of Parenting Coordinators, Decision-Makers and Arbiters at their own expense – for these cases, keeping as many extra-ordinary expenses as possible on the Worksheet may be the most cost-effective and conflict-reducing option.
If you find yourself in a divorce, legal separation or a break-up from an individual with whom you have children, agreements regarding child support must be carefully drafted. Since family law is more forward-thinking than most areas of the law, no parent or legal professional can fully predict what a child may wish to pursue, or what enriching (yet expensive) costs may arise before a child is an adult, not to mention unforeseen medical needs. Some “recommended” uninsured medical costs are by definition not necessities of life and can also result in stonewalling or accusations that an ex is a spendthrift.
Furthermore, since Colorado law prohibits courts from compelling either parent to share in postsecondary educational expenses, a finely-tuned support settlement addressing savings for college (such as with 529 plans) and whether and how each parent will contribute must be carefully handled since parents have to enter into them voluntarily – parents with fewer financial resources than their ex must proceed delicately if they want their ex to agree to pay for some or all of their child’s college or other postsecondary education, and the better-off parent will no doubt insist on some limitations
Whether your child is healthy and uninvolved in many activities, or has unique or numerous medical or extracurricular expenses, the attorneys of Wells Family Law are experienced in negotiating agreements regarding extra-ordinary expenses that will undoubtedly arise, including an analysis of whether a deviation from the Worksheet formula’s monthly dollar amount may be warranted.
Written by Zachary S. Roeling, Senior Associate Attorney