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Can a guardian receive compensation for their work?

On Behalf of | Apr 21, 2020 | Executors, Fiduciaries, Trust Administration, Trustees |

Serving as legal guardian of another adult is sometimes necessary to ensure their safety and well-being. It is also a big responsibility, one that requires time, patience and a good heart. This commitment may pull you away from your normal life, including potentially your job.

Because of this, many people considering a guardianship role wonder: Can I be compensated for my time?

Compensation may be allowed

Under Colorado law, a guardian is entitled to compensation for their services. However, it is not automatic. Here are some things to keep in mind:

  • The hourly rate must be deemed “reasonable”.
  • The court (or a conservator, if applicable) must approve any compensation.
  • Time spent with the ward for friendship or companionship generally doesn’t qualify for compensation.
  • This compensation is considered income – so is taxable.

Reimbursement for certain expenses paid by the guardian is also possible, but generally must follow the same guidelines for compensation.

What qualifies as reasonable?

As mentioned above, any compensation paid to a guardian must be reasonable. There is not a one-size-fits-all rule when it comes to determining whether payment is reasonable. Instead, it is made on a case-by-case basis, the Colorado Bar explains.

This is one of the many reasons why thorough, detailed record-keeping is absolutely vital as a guardian. You will need to show exactly how much time you spent doing guardianship work, what you did, and whether you spent any money.

In addition, at any time, the court or another interested person can request to see paperwork supporting any compensation or reimbursement claims you’ve made.

You do not have to take compensation. In fact, many individuals that serve as guardians for loved ones choose not to do so. However, for those facing financial questions, this type of arrangement is a possibility.