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FINANCIAL NEWS

Which state pays the highest alimony?

Many divorces result in one spouse paying alimony to the other. How much and how long that will be is determined by a judge varying widely across the US.

Spousal support across the United States
SHANNON STAPLETONREUTERS

Alimony, also referred to as “spousal maintenance” or “spousal support”, provides financial support to a spouse generally to bridge the income gap until the one who relied on their partner’s earnings can establish a new post-divorce life. Each state has its own statutes for determining the amount of spousal support and the length of time that the payor will be required to maintain the other.

Types of alimony differ and the requirements to request that an ex-spouse pay exist in every state. Although judges in some states can still award permanent alimony, this has become less common. The various aspects of alimony structures across the United States and the discretion that judges have when determining it makes it nearly impossible to say in which state an ex-spouse will be awarded the most in alimony.

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When and why is alimony awarded?

Judges will consider many factors when calculating how much one spouse should pay the other after they have divorced. Perhaps the separation of assets will leave both spouses with sufficient income that no alimony need be awarded.

A judge may take into consideration the state’s guidelines for awarding spousal maintenance, which is not the same as child support. As well they will look at the length of marriage, generally there is a minimum amount of time that a couple must be married, or in the few states that still recognize common law marriage that the couple was together.

Additionally, the judge will take into consideration the age, health of both parties, and the ability of the spouse requesting financial support to re-enter the workforce to establish a post-divorce career. The ability of the ex-spouse to pay will also factor into the equation along with how much child support they will be responsible for depending on if they are the custodial parent or not.

Spousal maintenance payments can be modified in the future if there are material changes in either spouse’s circumstances, unless the settlement agreement specifically states that it is non-modifiable. You can find an alimony calculator and state by state information at MaritalLaws.com.

Alimony awarded since 2019 is no longer taxed nor tax deductible

In 2018 the tax code was substantially changed for how alimony payments for both the supporting spouse and the dependent spouse are treated for federal tax purposes. Under the Tax Cuts & Jobs Act of 2017 alimony awarded in any divorce settlement after 31 December 2018 is neither tax deductible for the payer spouse nor taxable income for the receiving spouse.

However, the repeal of the tax deduction and taxable status does not apply to alimony settlement established prior to 1 January 2019. Even if the spousal support agreement is modified after that date. Unlike other tax modifications in the legislation, the alimony provisions were made permanent.

Permanent alimony is becoming less common

As more and more marriages become dual-income, judges even in states that allow for permanent alimony are less likely to award it for such a length of time. There are even moves to get rid of indefinite spousal maintenance. Legislation was recently passed Florida’s lower chamber to do away with permanent alimony, but it was awaiting the governor’s signature as of publishing this article.

Indefinite spousal support may be awarded in situations involving long-term marriages or where a spouse is too old to feasibly reenter the workforce to have financial stability, or has developed a disability or health issue that prevents them from supporting themselves in the future. States that may still award permanent alimony include Connecticut, Florida, New Jersey, North Carolina, Oregon, Vermont and West Virginia.

However, like the proposed revamp of Florida’s law, the supporting spouse can request that alimony payment cease upon retirement in Connecticut and Vermont. Otherwise they may continue up until the death of the receiver or payer, even then the estate of the payer may continue sending money to the dependent spouse.