What Is Alimony?

Alimony is a term used to describe court-ordered payments awarded to a spouse or former spouse in a separation or divorce agreement. This form of support is intended to maintain a spouse’s standard of living after a divorce until he or she has the opportunity to maintain that standard without the payments. Alimony is almost always awarded to the lower-earning individual in marriages that have lasted at least ten years. The amount of alimony that is awarded — and the duration for which it is received — depends on a number of factors, including how long the marriage lasted and the current or potential incomes of each partner in the marriage. Other factors that may impact who receives alimony and how much alimony is to be received include:

• Each spouse’s age, health, and physical capabilities
• The paying spouse’s ability to pay alimony
• Each spouse’s comparative financial resources and earning ability
• Contribution that the alimony-seeking spouse has made to the paying spouse’s earning ability
• Any excessive spending, gambling, or destruction of marital property that has been committed by either spouse.

For the receiver of alimony, the payments are a form of taxable income. For the payer, they are a deductible expense. Alimony payments cannot be discharged through bankruptcy, and they are specifically meant to be used to meet the needs of the spouse or former spouse. Payments intended to be used for the couple’s child or children’s needs are considered child support, not alimony. For further explanation on the types of support that may be ordered in divorce cases in Arizona, trust DeShon Laraye Pullen PLC for accurate and complete information.

What Arizona Law Says About Alimony and Remarriage

According to Arizona law, there are only two situations outside of an agreement between spouses or express provisions in the divorce decree that can end the obligation to provide maintenance payments as ordered:

• Death of either party.
• Remarriage of the party receiving maintenance.

The law also provides the ability to suspend alimony and other types of support payments if the paying party suffers a mental or physical injury that prevents him or her from working for a period of time. In these circumstances, payments generally resume when the situation that caused the paying party to be unable to meet his or her financial obligations improves.

The obligation to pay maintenance automatically ends in cases of death or remarriage, though the paying party will need to file a motion to terminate the support and provide proof to the court of the remarriage. If the paying party continues to make his or her payments without being aware of the remarriage, he or she may be entitled to a refund of those payments that were made after the remarriage occurs. Once a payment has been terminated due to remarriage, that payment cannot be reinstated, even if the receiving party’s remarriage ends in annulment or divorce.

Alimony and Cohabitation

According to an article published in the Atlantic, more and more people — particularly younger adults — are choosing to cohabitate rather than getting married. While there are many reasons for this, the fear of the psychological, emotional, and economic implications of divorce are at the top of the list. To many of these individuals, cohabitation offers the benefits of marriage, including help in paying the bills as well as physical and emotional companionship, without the risks posed by divorce.

Arizona law is not clear on how cohabitation impacts the provision of spousal maintenance payments. However, the more closely the cohabitation resembles a marriage, the more likely the courts are to consider the change in the cohabitating individual’s income that may no longer necessitate alimony payments by a former spouse. In order for a paying spouse to have a judge consider the modification or termination of spousal support to a cohabitating spouse, he or she must file a motion for modification or termination with the court. Evidence relating to the economic nature of the cohabitation, including proof that the support-receiving spouse and his or her cohabitating partner are sharing expenses will be required in order to prove that the cohabitating spouse’s expenses and needs for support have experienced a significant and continuing change.

If you are interested in modifying or terminating spousal support due to cohabitation by your former spouse, the experienced attorneys at DeShon Laraye Pullen PLC can explain the process in more detail.

What if the Paying Spouse Remarries?

Alimony payments cannot be modified due to the remarriage of the paying spouse. Even if the remarriage comes with new household expenses or there are children born into this new marriage, the obligation to the former spouse receiving maintenance payments will continue unless there is a significant and continuing change in income that results in the paying spouse being unable to pay. Often, even if the spouse is unable to pay, the order will only be suspended — not terminated — until the spouse is again able to meet his or her obligations.

Do You Need to Modify Your Agreement?

The courts in Arizona realize that there are changes that may significantly impact the ability to pay or the need to pay support and allow for support agreements to be modified as situations warrant. If your spouse is remarried, planning to remarry, or is cohabitating, we can help you understand the legal options that are available to you. For more information and a case evaluation, contact the experienced family law attorneys at DeShon Laraye Pullen PLC online or by calling (602) 252-1968.

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Regardless of the reason for divorce, it is expensive. Many estimates put the cost of divorce starting in the $10,000 to $20,000 range. And it only goes up from there. The more assets you have, the more expensive your divorce becomes.

Working with a trusted and compassionate Arizona divorce lawyer can provide you the guidance and support you need during this emotional period of your life. The right lawyer can also help you save on costs and make sure you don’t spend more the necessary.

Common Reasons for Divorce

To file for divorce in Arizona, you must have been a resident for at least ninety days. Arizona is also a no-fault divorce state so you do not have to provide a specific reason for your divorce. On your divorce petition, all you must allege is that your divorce is irretrievably broken.

But there are some common reasons a married couple moves forward with divorce. These include:

• Infidelity
• Abuse
• Unrealistic expectations of marriage
• Lack of preparation
• Lack of equality in the marriage

Your situation is unique to you. While you may experience one or more of these situations in your marriage, the question of whether divorce is right for your marriage is up to you. You might think what went wrong in your marriage but it’s important to not focus on that but instead what you do next. Deciding on divorce is a difficult decision and one that you should not take lightly but when you have decided, it’s important to work with a seasoned divorce lawyer in Arizona to help you navigate the complex legal process ahead.

Most divorces are not simple, especially divorces involving high net worth couples. Issues needing resolution often include:

• Parenting time
• Decision-making authority for children
• Child support
• Alimony
• Division of property
• Division of assets

You also need to consider time. Once you file for divorce, there are filing deadlines which must be met, including financial disclosures. These documents are complex and require a deep dive into your financial life. The court requires this information to make sure each person is receiving an equitable distribution of marital assets. During this discovery process, we can also determine if your spouse is hiding assets in an effort to reduce what they may have to contribute to the divorce. It’s shady but we have seen it happen many times.

Why High Net Worth Divorces Cost More

As a high net worth individual, you have more property and other assets which require division between you and your spouse. Sometimes, courts must get involved to split your assets, further increasing the cost.

When contemplating divorce as a high net worth individual, speaking with an experienced divorce attorney in Arizona can give you the confidence you need that your divorce will be handled correctly. One of the most important things you need to understand is your finances. If you know what you have as a couple, you know what a fair distribution might look like. Your lawyer will help you with this step.

High net worth divorces may also be more expensive because they are more likely to be contested. When this happens, courts are often involved and that greatly increases attorney fees. This does not mean you should avoid hiring a lawyer. That can be the worst decision you make.

To ensure you receive a fair distribution of your marital assets, evaluating your full net worth is important but takes time. In addition, some assets may not be marital property. When you got married, most of your assets became marital property and anything you acquired during your marriage might also be marital property. But there are some exceptions which your lawyer can help you determine.

Many high net worth divorces also involve international assets. This creates extreme complexities with your divorce, including possible tax ramifications. This requires the keen eye of an experienced Arizona divorce lawyer with a thorough understanding of high net worth divorces and your specific situation.

In high net worth divorces, alimony payments may also be extremely high. Alimony is used to keep the spouse who may not have been the high earner in the marriage in the same or similar living situation they were in during the marriage. But sometimes, a spouse will conceal property, bank accounts, and other assets to reduce their overall net worth. This results in a reduction of the potential alimony they need to pay.

Don’t Rush

Divorce is expensive. You need to make sure divorce is the right decision for your specific situation. Once you determine it is, then you need to make sure you take it seriously.

We often hear clients say they just want to get divorce over with and move on with their lives. We understand this is a complex and emotionally draining process. But if you don’t do it right this time, you may have to go down this road in the future to make sure you have a fair and equitable distribution of your assets.

Rushing divorce can result in making grave financial mistakes. You cannot correct some of these mistakes after we finalize your divorce. We know it’s painful but let us help you protect your rights.

Speak with a Divorce Lawyer

Many people choose to live together before marriage. That can help reduce the likelihood that the couple’s marriage will end in divorce. But it’s not a guarantee. So don’t ignore how you feel and seek out help right away.

When you have made the decision that divorce is the right choice for you, seek out a skilled Arizona divorce lawyer. The right lawyer can help you protect your rights during divorce proceedings to ensure you do not regret rushing through the process.

Contact us online or at 602-252-1968 today. Dedicated. Loyal. Trustworthy. Reliable.

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While there is no guarantee that you will receive spousal maintenance after your divorce, if you qualify and the court deems you in need, this financial bump can help you better navigate your post-divorce life. If you have divorce concerns related to alimony, the dedicated family law attorneys at DeShon Laraye Pullen PLC in Phoenix are committed to helping you obtain a divorce that works for you – and that includes alimony if you are so entitled.

Your Divorce

Before you can receive alimony, you must directly ask for it in your divorce petition. If you waive your right to this spousal maintenance, you can’t go back in and modify your decree in an effort to obtain it. In other words, it’s important to get this right from the get-go, and working with an experienced family law attorney will help ensure that you do.

Your Affidavit of Financial Information

Your Affidavit of Financial Information (AFI) is critical to every financial component of your divorce, including child support and alimony. As such, it’s imperative that you pay close attention to compiling a financial affidavit that accurately reflects your finances. This document will delineate your gross monthly income from every source, your monthly expenses, and the children you support. You will provide your divorcing spouse’s attorney with your AFI along with supporting documentation, and it’s important that the numbers on both match each other.

The information on your AFI will likely include:

• Documentation regarding your income (including paystubs)
• Financial information related to self-employment (as applicable)
• Financial information pertaining to your children (including daycare and babysitting as applicable)
• Information related to your current and past employers
• Your income taxes for the last three years
• A list of your monthly expenses
• Information about expenses related to medical/eye/dental insurance
• A list of your outstanding debts

Temporary Spousal Maintenance

As you move through the divorce process, you may need temporary spousal maintenance to help keep you afloat, and you can file a motion for the same. Your motion should lay out exactly why you need the financial support and should demonstrate that your divorcing spouse is capable of paying for it. The basics should include:

• Your expenses
• Your income and its inability to cover your expenses
• Your lack of access to community funds
• Your spouse’s income and ability to cover your financial needs during the pendency of your divorce

Your motion can also address expenses associated with your divorce, such as your legal fees and moving costs.

The Initial Analysis of Your Case: Qualification

To qualify for alimony, you must be able to prove that at least one of the following applies to you:

• Your personal property alone (the income it produces) is not sufficient to provide for your reasonable needs.
• You are unable to provide for your reasonable needs through your ability to work alone, or you lack the earning potential to earn enough, or you care for a child whose age or health requires you to stay home and not work.
• You significantly contributed to your divorcing spouse’s educational and/or career successes.
• Your marriage lasted many years, and you are currently of an age that precludes you from obtaining employment sufficient to provide for your reasonable needs.

If at least one of these does not apply to you, you don’t qualify for alimony, and the process ends here.

Analyzing the Factors Specific to Your Situation

Once you are determined to qualify for spousal maintenance, the court will take the factors specific to your situation into account in determining the amount of support you will receive and the duration of that support. These factors include:

• The standard of living you and your spouse established during the course of your marriage – The court recognizes that you and your spouse probably won’t both be able to maintain the standard of living you reached in your marriage, but it is interested in making sure that your separate standards of living won’t be seriously lopsided.
• The length of your marriage – Generally, a marriage that lasts less than ten years is considered a short marriage, a marriage that lasts from 10 to 20 years is considered medium length, and a marriage that lasts more than 20 years is considered a long marriage. Longer marriages generally translate to more alimony for a longer period of time.
• Your age, physical and emotional health, earning capacity, and employment history – The court will look at these components in relation to your ability to earn. The less able you are to earn, the more significant your alimony amount and duration are likely to be.
• Your spouse’s ability to pay alimony
• The comparative financial resources that both of you have
• Your contributions to your spouse’s ability to earn
• The extent to which you sacrificed your own earning potential to stay home and care for your family
• You and your divorcing spouse’s ongoing ability to contribute to your shared children’s education
• Amount of time you’d need to get the training or education necessary to obtain a job that would adequately support you
• Excess spending, concealment of funds, or fraudulent disposition of marital property – If your divorcing spouse engaged in any of these practices, it can lead to him or her paying more in spousal maintenance than he or she ordinarily would have.

If You Have Alimony Concerns, Contact a Phoenix Family Law Attorney Today

Financial concerns are among the most stressful concerns associated with divorce. The dedicated family law attorneys at DeShon Laraye Pullen PLC in Phoenix are committed to helping you obtain the spousal maintenance to which you are entitled. Our experienced legal team is on your side, so please don’t hesitate to contact or call us at 602-252-1968 for more information today.

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Divorced couples currently negotiating alimony agreements could suffer negative effects if the current bill becomes law, regardless of who pays and who receives support.

Alimony is necessary when a large income disparity exists between two divorcing spouses ending a marriage that lasted for many years. That financial discrepancy often becomes a hotly disputed aspect of most marital dissolutions. However, the one benefit of the financial obligation involves deducting the amount of support paid in.

Current law allows payers to deduct and requires recipients to claim it as income. However, a provision in the proposed tax reform bill would effectively eliminate the ability to write off support, creating a domino effect for both payers and recipients.

According to the Internal Revenue Service, approximately 598,888 taxpayers claimed alimony deductions in 2015, totaling $12.3 billion. A 2014 report revealed that the 500,000-plus payers deducted more than $10 billion in 2010. Yet, ex-spouses receiving payments claimed income of only $7.7 billion, representing a significant disparity.

Recipients are commonly in a lower tax bracket than payers, a consideration when assets are being divided during the divorce process. If the Tax Cuts and Jobs Act is enacted as currently written, those paying alimony will find themselves with less money that would go toward supporting their spouses. Instead, it will fill the federal government’s coffers

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Spousal maintenance: more women paying, more men collecting

More and more women in Arizona and across the country are discovering that when the bloom is off the rose in their marriage, the result might be that they, as opposed to their husband, may end up obligated to pay child support and even alimony. Such is the nature of progress and changing times.

It’s not that the laws are being applied differently but rather that women have climbed up the ladder to the point where many out-earn their husbands. And that simple fact could translate into a court order to pay spousal maintenance if the parties choose to divorce.

The principle behind spousal support is said to level the playing field for a couple in the years after a divorce where one party has substantially out-earned the other. A majority of divorce lawyers responding to an Academy of Matrimonial Lawyers survey noted that an increased number of women were paying child support, and almost half of them acknowledged that an increased number of women were paying alimony as well. The reason, it appears, is that gender equality in the work place is more of a reality than in times past.

It is generally conceded that, over the past years, the number of women attending law school has doubled, while the number of them attending medical school is approximately equal to the number of men. And that translates into more families where the woman makes more than the husband. What was once the traditional bastion of women, spousal maintenance can now just as easily be awarded to a man where circumstances document a financial disparity.

Spousal maintenance in Arizona is often complicated and is one of a number of issues typically negotiated in divorce proceedings. When minor children are involved, there may also be discussions over which parent is more suitable to enjoy primary physical custody, and those women in demanding, high-income positions may see that their soon-to-be ex-husband may make a better fit. And while not every woman who has achieved financial success is happy with the notion of paying alimony to a male, it is really not much more than an equal application of long-standing legal principles.

Source: Reuters, “Alimony: Women Increasingly Paying Alimony To Their Ex Husbands,” Patricia Reaney, May 10, 2012

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Arizona readers may be interested to hear about former MLB player Dave LaPoint, who was the subject of a U.S. Tax Court case recently after his attempts to deduct some of his alimony payments to his ex-wife were rejected by the IRS. The deductions were made in 2002 and 2004. The court ruled against LaPoint, holding that the deductions were not valid as made.

While married to his now ex-spouse, the couple executed a post-nuptial agreement that, among other things, provided for certain payments to be made to his wife while they were married. Part of the money involved was the future proceeds of a pending legal case between MLB and its players, loosely referred to as “collusion money.” This money was to be deposited for the benefit of the wife if and when the sums were received. The couple divorced before the “collusion money” was paid to LaPoint.

After the divorce, LaPoint received the money. He paid it to his wife as was the agreement in the post-nuptial agreement. However, he also claimed it as an alimony deduction on his income taxes. The Tax Court found that because of the language in his post-nuptial agreement, the “collusion money” was not alimony and thus not deductible. The reasoning was that for alimony payments to be deductible, they must meet certain requirements, including that no liability for the payments exists after the death of the payee.

In LaPoint’s case, the post-nuptial agreement expressly provided that the collusion money was to be paid to the wife’s heirs in the event of her death. LaPoint lost his case and now has a hefty tax payment due over and above the sums paid to his ex-wife. The case underscores the complexity of alimony issues when it comes to income tax matters. Those Arizona residents confronting similar issues would do well to assure themselves of the law as it applies to the facts and circumstances of their individual matter.

Source: Forbes, “IRS Strikes Out Retired Pitcher Dave LaPoint – Alimony Not For The Dead,” Peter J. Reilly, April 14, 2012

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