When couples divorce, courts in most states usually determine the alimony or the amount of spousal support or maintenance post marriage. The paying spouse, or the spouse with the higher income or the only one with the income, will be required to give financial support to the spouse with the lesser pay or no income.
The spouse who earns little or none at all has to cover wasted opportunities or lost ground prior to the marriage. With a decrease in his or her standard of living, the receiver of alimony is given leeway to make up for lost time and opportunities. Alimony or spousal support allows them to maintain the standard of living that they have been accustomed to while they were married.
A divorce court judge usually awards lifetime spousal support, especially if the recipient of the alimony will not anymore be capable of covering lost ground, or making his or her life financially better. For example, if the alimony recipient is not anymore young enough to work, untrained or has been out of the workforce for quite a while, or in an advanced stage of mental or physical deficiency, disability, or incapacity.
There are, however, various factors and issues on how courts determine the awarding of divorce alimonies, and how divorcing couples deal with these factors and issues involving spousal support. Here are the most common of them.
Ex Moves in with Boyfriend/Girlfriend but Never Remarries
Considered a very sensitive issue, there have been many instances when the former spouse will intentionally not remarry so as to continue receiving maintenance money, even though they have found a new boyfriend or girlfriend.
Some courts consider the act of cohabitation as a reason to stop permanent spousal support. But the aggrieved paying spouse must prove that the cohabitation or relation of the ex-spouse and the new partner has been long-term and going permanent, whereby the two appear to be sharing living expenses together.
In short, a permanent new relationship can end the permanent payment of alimony. Take note, however, that it is not enough for most courts if they determine that the ex-spouse and the new partner only stays together for the night a few times in a month.
Gambling Winnings and Stock Options
Generally, winnings in gambling are added to spousal support, but stock options are tricky and touchy. Many courts have determined that winnings from such games as poker or roulette are forms of income to be calculated for spousal maintenance. But in some cases, judges have ruled otherwise since gambling winnings are unstable income sources.
When it comes to stocks and corporate shares, however, reportedly only a very few divorce cases have considered this touchy subject. Stock options are supposed to be part of the overall compensation given to employees, and must therefore be treated the same way as any other sources of income. This view lends credence to divorce court rulings that stock earnings may be calculated for spousal support. But in some cases, this is not the view. In fact, this is one area of divorce laws that has remained unsettled.
Bigger Maintenance, Higher Tax Bracket
This may be quite complicated. Spousal maintenance is generally deductible expenses for the paying spouse, but is included as income for the receiving spouse. Paying spousal maintenance can give the ex-spouse payor some net savings in tax payments, but only by considering both the income tax returns of the recipient spouse and the paying spouse. The recipient spouse can save more in taxes since he or she may be able to deduct the spousal support, rather than the alimony-supporting spouse now paying in taxes by including the amount of alimony or maintenance in the latter income.
Paying alimony can be considered a favorable factor if the recipient spouse gets a tax benefit through this spousal maintenance, like liquidating some assets. But paying spousal support can be an unfavorable factor if any of the spouses incurs a tax liability.
Prenuptial Agreements and Proofs of Infidelity
Prenuptial agreements outline what may happen when it comes to dividing property or assets after a divorce or dissolution of marriage. One spouse makes significantly higher sources of income than the other. A prenuptial agreement aims to protect his or her assets during a divorce or dissolution, and to avoid having to pay alimony to the other spouse.
Infidelity has been cited as a reason for denying an alimony payment. But one needs actual and verifiable documents to prove acts of infidelity, such as multiple witnesses, photographs, video materials, or other incriminating pieces of evidence.
Courts also determine alimony based on the length of marriage, according to each state law. The earlier one ends the failing marriage, the lower the spousal support needed to be paid. Moreover, courts consider a paying spouse’s lifestyle aside from financial situation and income.
While some spouses have quit their jobs and declared bankruptcies to avoid paying alimony, it is best for anyone to simply downsize his or her lifestyle. There have been instances when, say, a doctor suddenly decides to work for a fast-food chain in the hopes of lessening his alimony obligations. In some states, the court may decide that it is not the actual amount of take-home pay, but the capability to earn and not pretend to be a pauper.
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