Imputing Income for Child Support in Colorado

A look at the process of imputing income in Colorado and how it impacts child support.

In Colorado, every child has the right to be financially supported by his or her parents, whether the parents are married to one another or not. A parent’s income is a key factor in deciding how much financial support is owed. Unfortunately, some parents try to lower the amount of child support owed, or avoid paying altogether, by intentionally reducing their income. They may do this by voluntarily quitting a job or by refusing to work at the level they are capable of (being “underemployed”).

Parents who reduce their income in order to avoid child support may think they are gaming the system, or that they will punish the other parent by paying less. However, it is the child who suffers by not having their financial needs met.

This article will explain when and how courts will attribute or “impute” income to parents. If you still have questions after reading this article, you should contact an experienced family law attorney for help.

Overview of Child Support Orders

In Colorado, parents owe child support to their child until the end of the month that a child who has finished high school turns 18 or until the end of the month that a full-time high school student turns 19.

Parents can agree on the amount of child support to be paid. However, if they are unable to agree, a parent (or the Colorado Office of Child Support Enforcement on behalf of the child) can ask a judge to set child support.

Colorado calculates child support using the “Income Shares Model” of support, which is based on the gross income of both parents and general information about what intact families spend on their children. The “noncustodial” parent’s share of support sets the amount of the order. For more information on how child support is calculated, see Child Support in Colorado. The visitation arrangement will also affect the amount of support, and parents typically share the costs of child care, medical care and insurance.

What is Imputed Income?

When a court determines that a parent is shirking his or her duty to pay child support by being voluntarily unemployed or underemployed, a judge may "impute" income to that parent. This means the court will attribute or credit income to that parent based on a finding of the parent’s potential income.

Let's say, for example, Parent A has been making $85,000 a year as an IT manager for over 5 years. Just a few weeks before a child support hearing, Parent A suddenly quits working in order to pursue a new career in landscaping and then claims to have no income to support his or her children. Parent B will have the opportunity to show that Parent A quit simply to avoid child support payments - if that is shown, the court can impute income to Parent A. The amount imputed will be equal to what Parent A could earn. In this case, Parent B could probably use $85,000 as the most recent salary and Parent A would have to pay child support based on that amount of imputed income.

Differences Between Involuntary Unemployment, Voluntary Unemployment and Underemployment

Involuntary Unemployment

A court is not likely to impute income to a parent that is truly involuntarily unemployed. Some common examples of involuntary unemployment include:

  • when a parent is unable to work due to a physical or mental incapacity
  • when a parent loses a job (involuntarily - either by getting terminated or laid off) and is unable to find another job after making good faith efforts to find work - the parent must be prepared to show evidence of diligent efforts to find another job, which may include sending out applications and/or resumes and going to interviews.

Voluntary Unemployment

Voluntary unemployment is when a parent is able to work and has an opportunity to work, but chooses not to. Simply losing a job will not automatically mean the parent is voluntarily unemployed, even if the parent was fired due to misconduct on the job. However, if the parent does not make efforts to get another job, then the court will find voluntary unemployment. Some examples of voluntary unemployment include:

  • losing or quitting a job, and not making good faith efforts to get another one
  • being fired due to drug abuse, and failing to treat the addiction so to get another job, and
  • quitting work to return to school without having an expectation of earning higher income upon graduation.

Voluntary Underemployment

Voluntary underemployment happens when a parent makes less than diligent efforts to find employment at a level equal to or better than income formerly received. The court will look at recent work history and employment qualifications to decide if a parent is working below full capacity. Some examples of voluntary underemployment include:

  • voluntarily cutting back on work hours
  • quitting a professional job to work as hourly laborer
  • refusing to file a benefits claim following work-related accident, and
  • refusing to reasonably use or invest his or her assets.

The duty of a parent to meet child support obligations is a strong legal duty. The court may find a parent to be voluntarily underemployed or unemployed even when the parent has made a legitimate decision to be voluntarily underemployed or unemployed. For example, a parent who moves away from a higher paying job and takes a lower paying job closer to where his child lives may have income imputed, despite the parent’s good intentions.

There are exceptions to imputing income. Some examples of when the court will not impute income are:

  • when a parent is physically or mentally incapacitated
  • when a parent is caring for a child who is under the age of 30 months for whom the parents owe a joint legal responsibility
  • when a parent only works part-time to have time to care for needs of a disabled child
  • when a parent is incarcerated for a term of one year or more, and
  • when a parent takes lower paying employment as a good faith career choice and not to avoid paying child support.

Enrolling in an educational program is a common question for parents in child support cases. The court will not impute income to a parent returning to school if:

  • the parent is enrolled in an education program that is reasonably intended to result in a degree or certification
  • the degree or certificate can be obtained within a reasonable period of time
  • the degree or certificate will result in higher income
  • the program is a good faith career choice, and is not intended to deprive the child of child support, and
  • the parent’s pursuit of the career does not unreasonably reduce the amount of child support available to the child.

However, if the parent fails to meet all of these criteria, income will be imputed to the parent.

How Do Courts Determine How Much Income to Impute?

After the court finds that a parent is voluntarily underemployed or unemployed, the court will then look at the unique facts of the case to decide what amount of potential income to impute.

When information is available, the court will impute the income amount from the parent’s former earning level. This may be the annual income previously earned by the parent or a salary comparable to the parent’s most recent job. The court may also look at prevailing wage rates in the region. In some cases, depending on the parent’s circumstances and ability, the court may only impute minimum wage.

Resources

For the full text of the Child Support Guidelines law, refer to Title 14-10-115 of the Colorado Revised Statutes

For more information on Colorado family law topics, see Divorcenet's Colorado Divorce and Family Law Section.

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