Grandfather's college trust misused by ex?

[coloradosky]

What is the name of your state? CO
My fiance's grandfather setup trusts for college for all his grandchildren. My fiance's son is 9 years old and when he was born my fiance and his wife (now ex-wife) choose to name his wife as the trustee. The grandfather is 94 so won't live long. The ex-wife is remarried, has 2 more children, and is the CP of the son. My fiance thought that since this trust came from his grandfather that would count as money from him for his son's college education. Now we're questioning this since we've recently heard that child support doesn't necessarily end at age 18 but that the courts can make the parents pay for college. We are wondering if the trust will count toward 1) court ordered support for college 2) my fiance's portion of paying for college? Our fear is that the ex-wife will go to court to have him pay 1/2 of college and she'll just pay her half from the trust-which of course would mean that she is forcing my fiance to pay it all from him and his side of the family! Her financial status is far, far above ours but she doesn't work, by choice, and her husbands financial status won't be figured in. My fiance and his grandfather live in Colorado, the child-support is setup in CO, and the ex-wife and son live in AL. Help!

 

[Silverplum]

Can't Granddad change the trustee???

What is the name of your state? CO
My fiance's grandfather setup trusts for college for all his grandchildren. My fiance's son is 9 years old and when he was born my fiance and his wife (now ex-wife) choose to name his wife as the trustee. The grandfather is 94 so won't live long. The ex-wife is remarried, has 2 more children, and is the CP of the son. My fiance thought that since this trust came from his grandfather that would count as money from him for his son's college education. Now we're questioning this since we've recently heard that child support doesn't necessarily end at age 18 but that the courts can make the parents pay for college. We are wondering if the trust will count toward 1) court ordered support for college 2) my fiance's portion of paying for college? Our fear is that the ex-wife will go to court to have him pay 1/2 of college and she'll just pay her half from the trust-which of course would mean that she is forcing my fiance to pay it all from him and his side of the family! Her financial status is far, far above ours but she doesn't work, by choice, and her husbands financial status won't be figured in. My fiance and his grandfather live in Colorado, the child-support is setup in CO, and the ex-wife and son live in AL. Help!

 

[CJane]

Can't Granddad change the trustee???

No kidding. That should be the FIRST step.

But it's also fairly unlikely that Dad would be ordered to pay 1/2 of college, isn't it? It's MORE likely that he'd be required to continue paying CS through age 22 or something, and Granndpa's money wouldn't figure into THAT.

 

[coloradosky]

Of course that would be the easiest solution. LOL It's more complicated. Grandfather and fiance's immediate family aren't on great terms and fiance only "talks" to him a couple of times of year by email. (fiance and him are on ok terms) We think he is doing poorly physically and possibly mentally. I'm not mentioning all of the complications here. But, anyway, we wanted to see first if my fiance is in danger of not having this trust be counted as coming from him or being counted towards court ordered college child support before my fiance TRIED to have his grandfather change the trustee. Fiance just always thought college was taken care of for his son. If not, we need to setup a college fund as soon as we can.

 

[Silverplum]

Of course that would be the easiest solution. LOL It's more complicated. Grandfather and fiance's immediate family aren't on great terms and fiance only "talks" to him a couple of times of year by email. (fiance and him are on ok terms) We think he is doing poorly physically and possibly mentally. I'm not mentioning all of the complications here. But, anyway, we wanted to see first if my fiance is in danger of not having this trust be counted as coming from him or being counted towards court ordered college child support before my fiance TRIED to have his grandfather change the trustee. Fiance just always thought college was taken care of for his son. If not, we need to setup a college fund as soon as we can.

IS he already COURT ORDERED to pay for college?? Major q, must be answered.

 

[Silverplum]

Here's a good Forbes article for you:
http://www.forbes.com/taxesandestates/2007/02/13/divorce-kids-education-pf-estates-in_mb_0213money_inl.html

And a good website for you from the American Bar Association:
http://www.abanet.org/family/familylaw/FLQchildsupport06.pdf

 

[coloradosky]

Silverplum, thank you for the articles. I see from the forbes article that in Colorado you cannot be ordered to contribute towards college UNLESS it is in the parent's divorce/child support agreement. I do not know if fiance has any provision to pay college costs in his divorce/child support agreements. I will let you know when I find out. (Fiance is currently out of town) Again, this is really a big surprise to fiance since he thought his grandfather's trust would count towards his contribution for college and we're trying to find out if we need to worry about that or not. Fiance was prepared to pay towards his sons education after the trust was used up. Looks like I need to gather some more information before you guys can help further. THANKS - this has helped.

 

[stealth2]

Here's the deal... Grandpa's $$ aren't Dad's. So they have nothing to do with what he may or may not be ordered to contribute. If Dad is smart, he'd look into having some sort of verbiage added to the order that he & Mom split the cost minus what the trust pays for. (BTW - college expenses can be added in a modification.)

 

[LdiJ]

Here's the deal... Grandpa's $$ aren't Dad's. So they have nothing to do with what he may or may not be ordered to contribute. If Dad is smart, he'd look into having some sort of verbiage added to the order that he & Mom split the cost minus what the trust pays for. (BTW - college expenses can be added in a modification.)

I agree. The trust should be viewed as something similar to a scholarship or student loan, and mom and dad should be splitting expenses in excess of what the trust covers.....and the kid should be involved too. It should be a three way split.

 

[Silverplum]

Here's the deal... Grandpa's $$ aren't Dad's. So they have nothing to do with what he may or may not be ordered to contribute. If Dad is smart, he'd look into having some sort of verbiage added to the order that he & Mom split the cost minus what the trust pays for. (BTW - college expenses can be added in a modification.)

I agree with what you wrote, but just FYI for OP:

*college expenses can be added in CO to an order -- but not if the order was made prior to July 1, 1997. An order for child support entered prior to July 1, 1997 that does not provide for postsecondary education expenses shall not be modified to include such costs.

*Further, CS is ended and college support is ordered from BOTH parents AND considers "the child's resources" as well as the ability of each parent to pay.

*Either parent or the child may move for such an order at any time before the child attains the age of 21.

*If the child resides in the home of one parent while attending school or during periods of time in excess of thirty days when school is not in session, the court may order payments from one parent to the other for room and board until the child attains the age of 19.

 

[moburkes]

Agreed. Grandpa's money is NOT dad's money. It is grandpa's money, unless dad contributed to the trust.

 

[coloradosky]

Thank you guys for your insight on this. I spoke with fiance about the information you have all provided and he agreed that the correct way to look at this is that the trust isn't his contribution but that the trust is his son's. The trust should be subtracted from the costs that mom & dad evenly split - and his son should also contribute.

*Further, CS is ended and college support is ordered from BOTH parents AND considers "the child's resources" as well as the ability of each parent to pay.

Our main worry was that mom might be able to have the trust count as her contribution. Since the trust is in his son's name, this really helps alleviate this worry as the trust is "the child's resources".

Fiance wrote grandfather today asking if it was possible to add his name as a trustee, in addition to his ex, so he can monitor/manage it as well. Fiance doesn't even know the current amount of the trust which is obviously something we need to know in order to start planning for son's education. He really hadn't put much thought into this until I started asking questions. Thanks again everybody.