It’s a stereotype, but family lawyers still see it: a long term marriage where one party works hard, earning a significant income and the other party didn’t work and stayed home to raise the kids, foregoing their own career for the benefit of the family. What happens if these two people divorce? The stay-at-home parent contributed to the family, but so did the income earner by working hard and earning money. How do we resolve the difference in income earning capabilities between the parties? The answer may be alimony.
Alimony is a court-ordered obligation for one party to pay support to the other. There are different forms of alimony, four to be exact. But for the purposes of this article, let’s focus on the main type of alimony we see – general term alimony, which is alimony paid by one spouse to the other for a period of time. Here are the questions we get a lot when we first meet with clients and discuss general term alimony.
WILL THERE BE AN ALIMONY ORDER IN MY CASE?
Attorneys, and definitely family law attorneys, say this a lot, but the answer to whether there will be an alimony order in your case is that depends on a number of different factors.
What does it depend on? Like a lot of legal issues, there is a legal standard to be applied with regard to alimony. In basic terms, a court can order alimony where it’s demonstrated that there’s a need on the part of the recipient to get alimony and there’s an ability on the part of the payor to pay alimony. Put simply, for there to be alimony, one party needs to receive alimony and one party must have an ability to pay alimony.
So who has a “need” and who has an “ability to pay”? This depends on a myriad of different factors. Two of the major factors are the incomes of the parties and their expenses.
Let’s do a simple example. Let’s say Party A wants alimony. Party A earns $150,000.00 per year and has yearly expenses of around $100,000.00. Party A’s case for alimony is weakened because they can meet their expenses using their income.
Let’s tweak that example. Party A earns income of $50,000.00 per year and has yearly expenses of around $100,000.00. Party A’s case for alimony is a bit stronger because there’s a clear-cut need.
Now let’s consider the “ability to pay” portion. Party A earns income of $50,000.00 and has expenses of around $100,000.00. Party B earns a yearly income of $45,000.00 and has expenses of $100,000.00 per year. This probably isn’t an alimony case because Party B makes much less. If anything Party A might pay alimony to Party B, but that’s also pretty unlikely given how similar their income level is.
You might be asking, “What about child support?” or “What if the payor’s income was much higher in year’s past?” or “What if the income is low but there are assets available to pay alimony or meet the other party’s needs?” Those are all excellent points. We’ll dig into those issues in future articles but you should know that every case is different. To that end you should speak with an attorney to get a better handle on your rights and risk. I have represented clients in a number of different cases where one simple fact changed the trajectory of an alimony determination.
HOW MUCH ALIMONY SHOULD BE PAID?
It’s important to note that while there are laws which provide parameters on how alimony will operate, alimony is still a discretionary issue. That means that the court has a great deal of leeway in its determinations regarding alimony.
That being said, in 2012, the Massachusetts legislature enacted the Act to Reform Alimony (ARA) (LINK: https://malegislature.gov/Laws/GeneralLaws/PartII/TitleIII/Chapter208/Section48) which significantly changed how alimony is ordered. Thanks to the ARA, we have a lot more guidelines upon which alimony should be entered.
One of those guidelines relates to the amount of alimony to be paid. First, the amount of alimony to be paid should not exceed the recipient’s need.
Let’s go back to Party A and Party B again. Let’s change up the facts and say that Party A wants alimony and earns $50,000.00 a year with yearly expenses of $75,000.00. Party B (the payor) earns $750,000.00 a year and has expenses of only $50,000.00 a year. Even though Party B has a lot more disposable income ($700,000.00), Party B should really only have to pay alimony sufficient to allow Party A to meet their needs, which is $25,000.00.
But we also have guidelines and a formula for alimony. As set forth in the ARA, this is the presumptive formula for calculating general term alimony:
Payor’s gross income – Recipient’s gross income x 30 to 35% = Alimony amount
Put another way, you take the payor’s total income, you subtract the recipient’s gross income and you arrive at the difference, or the delta. Then you take the delta and multiply it by a percentage between 30% and 35%, a lot of times ending up at 32.5%.
But, as with a lot of issues in Massachusetts family law, it’s just not that simple and you really should speak to an attorney about your rights and risks.
For one thing, that alimony formula was created when alimony was tax deductible to the payor and includable as income to the recipient. Beginning in 2019, changes in the tax code meant that alimony orders entered on or after January 2019 were no longer tax deductible or tax includable. This makes a major difference in how we calculate alimony. There is currently legislation pending aimed at trying to fix this issue, but that legislation hasn’t been acted yet.
Also, there’s that word again: income. What if the payor or a recipient are choosing to earn an income which is far below what they’re capable of earning? There may be an argument for an attribution of income by which we can try and have the court assign an amount of income to a party, even if they aren’t actually earning that income. We’ll talk about that in a future article.
HOW LONG DOES ALIMONY LAST?
This was and continues to be a huge issue in Massachusetts family law. We’ve gotten a bit more clarification thanks to the ARA, but still some questions remain.
When talking about the length of alimony (officially called “duration”) you should take a look at an important case: Pierce v. Pierce (LINK: https://scholar.google.com/scholar_case?case=15972515617859301331&hl=en&as_sdt=6&as_vis=1&oi=scholarr)
Basically, the husband in Pierce was hoping to retire and wanted to terminate his alimony provision. There were no laws that set durational limits at the time of the Pierce case. That left it up to the judge’s discretion to determine whether alimony should continue. Given the facts of that case and without limits on duration, the trial judge determined that alimony should be reduced, but it should continue.
After the Pierce decision, there was a significant groundswell to get meaningful alimony reform pushed through the legislature and the ARA was the result. Thanks to the ARA, we now have guideline limits on how long alimony payments can last as follows:
- Marriages lasting less than 5 years: alimony lasts for 50% of the length of the marriage
- Marriages lasting between 5 years and 10 years: alimony lasts for 60% of the length of the marriage
- Marriages lasting between 10 years and 15 years: alimony lasts for 70% of the length of the marriage
- Marriages lasting between 15 and 20 years: alimony lasts for 80% of the length of the marriage
- Marriages lasting more than 20 years: alimony lasts for an indeterminate length.
Again these are statutory guidelines. Every case is different and it might be appropriate for alimony to go longer than the statutory guidelines or for alimony to terminate earlier than called for in the statute.
It’s also very important to note that the ARA says that alimony should presumptively end when a payor reaches “retirement age”- which basically means being able to collect Social Security benefits. Of course, there are exceptions to every presumption (including if a payor chooses to work beyond retirement age), but the ARA makes it pretty clear that a recipient needs to meet a pretty high standard of proof to get alimony beyond when the alimony order is supposed to end.
WHAT IS THE DIFFERENCE BETWEEN ALIMONY AND CHILD SUPPORT
Alimony and child support make up the two primary means of support between two divorced spouses. They’re somewhat similar in nature in that Party A pays an amount to Party B on a regular basis. But there are significant differences between alimony and child support.
For one thing, child support is typically calculated using the child support guidelines (LINK: https://www.mass.gov/info-details/child-support-guidelines) specifically a calculation created by the court (LINK: https://www.mass.gov/doc/2018-child-support-guidelines-worksheet-cjd-304/download). The amount of child support is primarily based on gross income and a few deductions, along with custodial arrangements and other factors, but it’s basically a calculation. Calculating an alimony amount starts with need and ability to pay, considering income and expenses, and now we have to consider the fact that alimony is no longer tax deductible. In a lot of ways, alimony is a much more complicated calculation than child support.
Then there’s duration. For the most part, child support ends when the child emancipates and that’s a pretty “hard and fast” rule with only a few exceptions. Alimony can go until the payor reaches retirement age, or perhaps even longer.
But again, every case is different. There are cases where alimony is appropriate and child support is not; there are cases where child support is appropriate and alimony is not. There are cases where there should be a child support an alimony order. To learn what options are available and appropriate in your case, speak with a family law attorney.