Alimony payments are made to the spouse who is financially disadvantaged. There are three primary categories of alimony:
- Periodic Alimony
- Lump-Sum Alimony
- Rehabilitative Alimony
1. Periodic Alimony
- Definition: In this arrangement, for example, a court might order the husband to make monthly payments of $2,000 to the wife until her death or remarriage.
- Duration: Indefinite, unless specific conditions—such as the receiving spouse’s death or remarriage—occur.
- Modification: Periodic alimony generally terminates automatically when the recipient either remarries or passes away. It may also end if the recipient cohabitates with someone of the opposite sex, as there is a presumption that financial support is no longer required. Additionally, the amount can be adjusted or ended if there are significant, unforeseeable changes in circumstances.
- Tax Consequences: The payer can usually deduct periodic alimony immediately, and the recipient must report it as taxable income.
2. Lump-Sum Alimony
- Definition: This form of alimony is useful if the parties prefer to sever financial ties entirely. A typical example might involve a court ordering the husband to pay a total of $50,000 in increments of $10,000 per month over five months.
- Duration: Covers a predetermined time, whether paid all at once or in installments.
- Modification: Lump-sum alimony cannot be modified. It is treated similarly to a contractual right.
- Tax Consequences: Depending on how this payment is designated—specifically if it is clearly labeled as alimony or integrated into a settlement agreement—it may or may not be deductible for the payer or taxable for the recipient. If it’s recognized solely as alimony, there’s a strong possibility it will be deductible by the payer.
3. Rehabilitative Alimony
- Definition: Often considered the most favored form of alimony, rehabilitative support is intended to help the disadvantaged spouse regain earning capacity. For example, a court might order a payment of $1,000 per month for 36 months.
- Duration: Provided for a specified period.
- Modification: Ends automatically if the recipient dies or remarries and is likely to end if the recipient cohabitates with a partner. The amount can be increased, decreased, or stopped if it’s proven that every reasonable effort has been made to regain earning capacity but without success.
- Tax Consequences: Similar to periodic alimony, the payer can typically deduct rehabilitative support, and the receiving spouse must pay taxes on it.
- Purpose: Intended to help the spouse who sacrificed career opportunities during the marriage become self-supporting again. This aims to bring them closer to the financial footing they would have had if they hadn’t experienced setbacks due to marital responsibilities.
Factors for Determining Alimony
When deciding on alimony, courts consider several elements, including:
- The spouse’s financial situation, potential earning capacity, and any other provisions from the divorce (such as property division or child support).
- The lifestyle the couple shared while married.
- The length of time needed for the disadvantaged spouse to find appropriate employment or complete any necessary education/training.
- The ages and overall health (physical and mental) of both spouses.
- Balancing the disadvantaged spouse’s financial needs with the other spouse’s capacity to pay.
- Each spouse’s physical condition, including any disabilities or ongoing medical issues.
Considerations for Awarding Alimony
Courts focus on two main considerations when deciding on alimony:
- The disadvantaged spouse’s financial need.
- The paying spouse’s ability to provide support.
Although marital fault can be factored into alimony decisions, it typically does not affect how property is divided unless one spouse has misused or wasted marital assets. Courts may impose wage assignments to ensure these alimony payments are made. To alter existing alimony orders, one usually needs to prove a significant, ongoing change in circumstances (for example, death, remarriage, cohabitation with a new partner, or objectively reasonable retirement).
Alimony Pendente Lite
This type of alimony is more liberally provided to help the financially disadvantaged spouse cover expenses related to the divorce proceedings. It concludes when the divorce litigation ends and generally is not affected by cohabitation. There may be variations if the couple’s combined net monthly income surpasses $30,000. When calculating alimony pendente lite for higher incomes, courts may apply a similar formula used for lower incomes (subtracting 40% of the difference, based on whether minor children require support). Judges are also directed to consider how long the marriage lasted when determining the duration of spousal support or alimony pendente lite.
About Divorce Lawyer R. Badet
Divorce Lawyer R. Badet has extensive experience guiding clients through the divorce process. His practice includes handling both straightforward and complex divorce matters, as well as spousal support, child support, and custody issues. As a seasoned attorney, he has the knowledge necessary to help clients achieve the best possible results. To learn more about legal options, visit his website at www.lawyersfordivorces.net or call for a free consultation. He is highly respected in both Family Law and Criminal Law and brings many years of courtroom experience to the table.
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