Posted by Fred Lake

Determining and collecting spousal support in a divorce

Determining and collecting spousal support in a divorce

Each state has guidelines for calculating spousal support. However, these are usually just guidelines. Whether the spousal's support is granted or not depends solely on the judge. The judge can also decide on the amount of the spouse's assistance and the period to pay. In some countries, there are no such guidelines: a judge decides whether or not to support the spouse's support, as well as the amount and duration.

An important point to note regarding testing and consultation methods unless they explicitly state that spousal support cannot be changed; it may be because of significant changes in the situation of one the spouse. In some countries, the exception is that a separation agreement cannot be changed, even if it is a substantial change in circumstances and according to the negotiations for the agreement, particularly in the event of contractual waiver support.

What factors would the judge consider?

Judges examine many different issues to determine first whether spousal support is available and, if so, how much and how long it should be paid. They will also discuss the need, the length of the marriage, the ability to pay, the number of kids, the standard of living, the health conditions and age of both parties, the level of education and livelihood.

Let’s take a quick read at some of these factors.

Needs

The initial inquest the judge will consider is: "Does the beneficiary have enough money?” The judge will examine the ability of the person to earn income before he separates assets from the spouse who wants support to determine whether they can use these resources as a source of support.

For example, John Snow earns $100,000 annually, and his wife accepted not to work after college to stay at home to care for their family. However, his wife has inherited $4 million from her parents. It is improbable to receive spousal support because she has $4 million and her matrimonial quota is used as support. In America, a lump sum may be awarded to compensate the spouse who has sacrificed his/her career for the interest of the family. Often, this amount depends on the length of the marriage and other circumstances. The general rule is that there will be no fixed price for a longer marriage unless it is challenging to get support or other exceptional cases. The best approach to demonstrate need is to prepare a detailed budget to determine the amount needed to support your spouse.

Ability to pay

The judge will decide how much the payer can pay and still have enough money to live up to his/her standard of living. To determine the spousal's ability to pay, the judge will add discretionary savings (such as automatic deductions for savings accounts, contributions to pension plans, securities purchase programs, and bonds). 

For example, John Snow earns $300,000 and invests $40,500 in discretionary savings. He spends $15,000 in the pension plan, $10,000 in the employer's share purchase program, $3,500 in securities and $10,000 in a capital market account. When the Judge calculates his ability to pay the spousal’s support, he will include the $40,500 retained on his salary for the discretionary income savings available to pay for the spousal's support.

If a person is in a high-paying job, the court should consider earning and claiming support for the well-paid spouse unless the person can prove that he/she was forced to give up medical care or other good reasons. In this case, the court will ignore discretionary savings, RRSP contributions, the employer's share purchase program, bonds or the money market account.

Duration of the marriage

The period of the marriage is also a factor to consider when the judge grants spousal support. If the marriage lasted about two years, the judge is unlikely to give permanent support to his wife. The judge cannot grant spousal support unless copies or other circumstances prevent the beneficiary from working. A judge takes into account all facts and circumstances.

For instance, if a couple has been married for forty years and the wife was say twenty when they got married and is currently sixty, the judge is unlikely to give her spousal support. However, if the woman was sixty years old at the time of their marriage and is now eighty, the judge can grant her permanent spousal support.

Quality of life

The judge will also assess the standard of living of the couple during the marriage. For instance, if a couple is married for twenty years and the man earns a salary of $500,000 annually, it would be unreasonable to claim that his wife could live on $80,000. However, if he had earned $30,000, it would be unreasonable for his wife to say that he should have received $20,000 to cover his expenses.

Health condition and age of both spouses

Another factor is the health condition and ages of both spouses. Is a spouse disabled or retired? If so, does the spouse get a steady stream of income? If a spouse is over 50 and has never worked, it will be difficult to find a job. The spousal's support must be guaranteed.

Duration of Spousal Support

Spousal support may be granted for a certain period or may last until it is changed or completed. Some judges have a general rule of providing support to spouses during a six-month marriage period. Alimony (spousal support) usually ends with the death of one of the spouses or the second marriage of the beneficiary. Spousal support will continue until changed unless the decree indicates that it cannot be changed.

During the separation period, any payment to the other spouse is generally not considered spousal support. However, if a temporary claim is made for spousal support and the claim does not establish that the payments will not be taxed as an allowance to the spouse, the spousal's support will be deductible by the payer and will be included in the claim of the beneficiary's income. In some countries, temporary assistance is deductible by the payer and is included in the recipient's income only if it is part of a court order or temporary contract.

What about taxes?

Generally, spousal support is deductible from the taxpayer and is taxable to the recipient. However, if one of the spouses receives a compensatory or lump sum support payment, it is neither deductible nor taxable. In the United States, a lump sum cannot be deductible or taxable if it is, in fact, a disguised ownership contract. Also, the recipient may be forced to reduce his or her income, and the payer must report additional income.

Fred Lake
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