If you are involved in a divorce proceedings, you may have an alimony issue. In Black’s Law Dictionary 9th Edition, alimony is defined as “[a] court-ordered allowance that one spouse pays to the other spouse for maintenance and support while they are separated, while they are involved in a matrimonial law suit, or after they are divorced.” If you make considerably more money than your spouse does, you will most likely be the one ordered to pay some alimony.
Alimony is awarded to the needy spouse to assist with maintaining a similar lifestyle as established during the parties’ marriage. Just as any other issue you might face during a pending divorce, you and your spouse can settle on the type, amount and time period the alimony will be paid. If you cannot come to an agreement, a court will established the terms for you. Having a court make the decision for you means that there will be a trial, and trials are costly. Especially for the party ending up paying the alimony, it may be wise early in the proceedings to agree to an alimony amount that the receiving party is willing to accept.
After alimony is ordered, one party will become the payor and the other party will be the payee (receiver) of alimony. Alimony is usually paid in a set amount on a set date each month. Sometimes, Alimony may be awarded in a lump sum or as a combination of periodic and lump sum payments. If an income deduction order is entered, alimony will be deducted according to the payor’s pay frequency. In Florida, there are five types of alimony, temporary, bridge the gap, rehabilitative, durational, and permanent alimony that can be awarded. For more information on these types of alimony, read our previous blog.
Alimony Payor – If you are the party that has to pay alimony to your former spouse, it does not mean that you are being punished or that you are a bad person. Paying alimony should be considered as “the cost of doing business.” In other words, it is part of the costs of entering into a marriage that you thought would last for the rest of your life but for some reason did not. Alimony laws have changed over the years, and presently it is ordered somewhat less frequent. Our culture has changed and most marriages include a dual income household where women are earning wages as well.
Alimony Payee – The court considers eight factors in determining whether you qualify for alimony. Three considerably major factors are your capacity to earn, your spouse’s income, and your lifestyle during the marriage. Depending on the type of alimony that is granted, you might be required to make some changes in your lifestyle and work. For instance, if you work part-time and your job does not pay well, you may be required to try to find a full-time job in a better-paid field. Or you may need to pursue other educational programs or obtain specific training and skills in order to obtain employment that will allow you to become independent.
Taxes and Alimony Records
Alimony used to be tax-deductible for the paying spouse and taxable income for the receiving spouse. Note that under the Tax Cuts and Job Act passed in December 2017, beginning with the 2018 tax year, individuals paying alimony will no longer be able to deduct their payments for tax purposes, and receiving spouses will not have to include alimony in their gross income. Even though tax law has changed on how to report alimony, it is still recommend keeping adequate records if you are paying or receiving alimony. These records will come handy in the event that you need to file for modification or termination of alimony.
Useful records the Payor should keep:
- A list showing each payment made, date, check number, address to which the check was sent, etc.
- Bank statements showing the cashed checks, or if you pay in cash, receipts for each payment, signed by the recipient. Make sure to note on each check/ receipt the month for which the support is being paid for.
Useful records the Payee should keep:
- Date and amount of each payment received.
- Check number or other identifying information; for example, money order, receipt, etc.
- Name of bank and account number on which check is drawn or money order issued.
- Copy of the check or money order, or any signed receipt you give for cash payments.
If you are filing for divorce and have questions about alimony that you may need to pay, or you may be owed, Seff & Capizzi Law Group has the ability to assist with your situation. At Seff & Capizzi Law Group, we regularly assist clients and provide valuable information for those that need assistance in understanding how to approach this particular situation in their own lives.
If you need assistance with collecting or receiving alimony payments, please call us at (954) 920-9220. We have over 40 years of experience and offer a free consultation. Click here for more information about our family law practice and how Seff & Capizzi can help.