Alimony and Spousal Maintenance
Although the law and terms used in Texas regarding alimony can get confusing, for the purpose of this article, “alimony” includes all payments from one spouse to another that are intended to transfer part of the income of one spouse to another, not counting child support.
Alimony can be “temporary” or “final.” Both temporary and final alimony can be agreed-to or court-ordered.
Temporary alimony is not the focus of this article, but just know this: it can be devastating. During the temporary period – while your divorce is pending – the court can order you to pay your spouse any amount the court believes is proper, up to 100% of your income.
“Final” alimony is the topic of this article. It is the alimony that gets paid pursuant to a final decree of divorce. Final alimony is the alimony most people are worried about and like temporary alimony, it can be agreed-to or court-ordered.
Agreed-to final alimony is pretty simple to understand – by agreement, you can agree to pay your spouse as much of your income going forward as you want to. This is often called Contractual Alimony, and if handled properly, it is tax-deductible. If handled improperly, however – for example, if it’s used as a substitute for child support, in an effort to save taxes – it can cause a tax nightmare.
Most people are not worried about agreed-to alimony – they figure they can stop themselves from agreeing to something stupid. The concern for most of us is about court-ordered alimony. Most people want to know what a court can do to them. When can I get ordered to pay? How much can I get ordered to pay? And for how long?
First, the good news: If your spouse will have enough assets after the divorce to meet her minimum reasonable needs, the court cannot order you to pay any alimony in your final decree. Of course, keep in mind, there is no definition for the term “minimum reasonable needs.” What you think your spouse reasonably needs may differ significantly from what they believe they reasonably need. What matters, ultimately, is what the court believes your spouse reasonably needs, and that will differ from judge to judge.
So what happens if your spouse will not have enough property to provide for her minimum reasonable needs? In that case, a court can order alimony if one or more of the following are present:
Family violence against the spouse or child of the spouse;
A disabled spouse or child, and the spouse cannot earn sufficient income; or
A spouse has an inability to earn sufficient income and the marriage has lasted at least 10 years.
If you fall into one of these three categories, the questions then become “how much” and “how long.”
When the award of alimony is based upon Family Violence or based upon the spouse’s inability to earn, and the marriage is less than less than 20 years, the maximum award is five years of alimony. If the marriage is more than 20 years, but less than 30, the court can award alimony for seven years. If the marriage has lasted more than 30 years, the court can award 10 years of alimony.
Of greatest significance, if the award of alimony is based upon the disability of the spouse or a child of the marriage, the award can be for an indefinite period. Yes, that means that if your spouse suffers a disabling injury on your honeymoon, and you get divorced two months later, you could end up paying alimony for the rest of your life.
With respect to the amount of alimony the court can order, the formula for the maximum is pretty simple – the lesser of 20% of your average gross monthly income or $5,000.00.
That means that for a 10-year marriage, with no disability issues, the most the court can order is $5,000.00 per month for 5 years, for a total of $300,000.00. For a 20-year marriage, with no disability issues, the maximum award would total $420,000.00, and for a 30-year marriage, the total would be $600,000.00. If disability issues are involved, however, the maximum could easily be $1Million or more.