Courts will award one party alimony based on the factors listed in N.J.S.A 2A:34-23. Contrary to what many people believe, based on anecdotal tales, there is no uniform formula a court will employ to come up with a number. While attorneys have informal equations they use as a starting point to discuss settlement, judges are required to apply the statute. Typically, they look at the length of the marriage, ability to pay and need. There are no cases that set forth exactly how alimony is factored. There are no alimony guidelines, as there are in child support. Each case must be determined on its own facts, which is why you should consult an attorney to make sure any amount you agree to will meet both you immediate and future needs.
In general, there are four types of alimony (now called spousal support). They are permanent, limited duration, rehabilitative alimony and reimbursement alimony. Recent changes to the federal income tax rules will make alimony taxable to the payor spouse, which reflects a sizable shift in thinking from the past.
Part of calculating spousal support is determining your fair share of equitable distribution. That means dividing the assets of the marriage between the parties. So, for example, one party may agree to less alimony if it means being awarded a larger share of the other party’s equity in the sale of a marital home, or a larger share of the other party’s pension or retirement account. Those assets can become part of the equitable distribution in a divorce and can help one spouse secure enough funding for their long term financial security.
Spousal support and equitable distribution are critical components to consider if you are seeking a divorce. Where you or your spouse has assets such as a pension, home, bonuses, or a stock portfolio, do not agree to waive your rights to your fair share without consulting an attorney. The Law Offices of Sadaf Trimarchi are available to meet with you to discuss your options. For specific tax related questions, you should consult with a financial tax advisor to determine compliance with state and federal guidelines.