While many individuals receive the same weekly salary, others receive a base salary and commissions, bonuses or other perks and thus have varying income each week. You may find it a bit concerning to find out that what can happen with this compensation in divorce largely depends on the type of pay involved.

What becomes of bonuses when a couple divorces?

End-of-the-year bonuses are typically treated much like any other asset when spouses divorce. You should keep a close eye on how the family law judge presiding over your case determines your annual income, though.

You may find that they add your base pay and bonus together and consider it to be your yearly income. You may end up having to pay more child support or alimony or having to turn over more property than your fair share if the court adds in your bonus to the rest of your standard pay.

It’s also essential that you note how the court tallies your income if you receive a prepaid bonus. Your employer might require you to pay back such a bonus if you leave your job prematurely or fail to reach your established performance benchmarks. You may want to have your attorney call attention to this when brokering a property division agreement or presenting your case in front of a family law judge.

What happens to commissions in a divorce?

Your spouse may only be able to stake a claim to any commission that you earned before leading up to your legal separation or divorce finalization date. You may be able to minimize how much your spouse can claim by speeding up your divorce.

It can be very disappointing to learn that you put in all that hard work to earn a commission, a bonus or another perk only to find out that you might lose it to your spouse when you divorce. An experienced family law attorney can advise you on how Colorado’s equitable distribution laws may impact what happens with your bonuses, commissions and other types of income.