Missing child support payments can lead to major legal headaches. Depending on the amount owed and the duration of the lapse, it could produce penalties such as wage garnishing, liens, and even federal prosecution. If you are finding it extremely difficult to pay your past-due child support obligations (arrears) – or if you believe you can negotiate with the other parent to dismiss what you owe – is it possible to legally forgive child support arrears in Colorado?
This is indeed a possibility, but the process is not entirely straightforward. Unmanageable child support debt can either be “reduced to judgment” or be part of a debt compromise program. Let’s take a look at how these mechanisms work in Colorado.
Reducing Child Support Arrears To Judgment
When you owe child support payments, it does not automatically become a formal debt. You owe money to the custodial parent, but that parent still has limited legal means to pursue payment. They cannot, for example, take your assets or demand payment directly from your bank.
However, the custodial parent can have the debt reduced to judgment, making it official with the court. Doing this is quick and simple. The parent owed the money only needs to calculate the amount owed and then file a Verified Entry of Support with the court clerk. The court will then enter the judgment that makes the debt formal and official. You will be formally called the obligor, and the parent owed the money will be the obligee.
With the judgment, the obligee has various legal options to pursue payment. These include wage garnishing (deducting the owed money directly from your wages), putting a lien on your property, and reporting the judgment to credit agencies.
Note, too, that the judgment accrues interest. In Colorado, traditional monetary judgments normally have an interest rate of 8 percent, but for child support arrears, the interest is 12 percent. This means that your child support debt grows once it is reduced to judgment.
Further, past-due child support cannot be retroactively modified or dismissed even if you file for child support modification or if you manage to negotiate with the obligee. This is due to a federal law called the Bradley Amendment.
Let’s say you have support arrears amounting to $5,000 as of January 2019. Then, in February, you request the court to modify your child support order, and the court decides to reduce your monthly child support rate. This reduces the monthly amount you have to pay from here on out, but does not wipe out nor reduce your prior unpaid dues. You would still have to pay the arrears of $5,000.
One way to manage child support arrears is to negotiate a settlement with the other parent. As with any other debt, you can talk with the obligee about reducing the lump sum you have to pay. Some obligees are compelled to settle with a lesser lump sum, particularly when they are trying to avoid more hassles in collecting the payment. But very often, negotiating a settlement becomes a highly contentious process that does not always result in an agreement.
Child Support Arrears Forgiveness Program
Not all child support payments are owed to custodial parents. Sometimes, a custodial parent may receive welfare from a state program such as the Temporary Assistance for Needy Families (TAFN). In this case, child support payments are “assigned” directly to the state in order to pay back the assistance that the custodial parent received.
If your arrears are assigned to the state, it is up to the government to offer a forgiveness or compromise for the debt. A compromise repayment program allows you to pay the state less than the amount you owe, based on your income and assets. In Colorado, implementing a debt compromise program is at the county level, so each county may or may not offer this program.
Our state has also looked at offering an arrears forgiveness program. One pilot program was conducted in 2001-2002 in two counties in Colorado. Under this project, if a debtor paid full and consistent child support over a period of 10 months, their state-assigned debt would be forgiven fully in Larimer County or up to $5,000 in Jefferson County.
A debt forgiveness program could be immensely helpful if you are not able to pay your assigned arrears. However, this program may still need much fine-tuning before it is implemented throughout Colorado. Check with your specific county to see if debt compromise or debt forgiveness is available to you.
If you have more questions regarding unpaid child support in Colorado, don’t hesitate to talk to us at Goldman Law, where knowledgeable family law attorneys can provide you with case-specific guidance.