Divorce, child support and alimony
When it comes to child support, the laws vary considerably from state to state. Some states allow “permanent” alimony in certain circumstances, but some do not. Most states allow for some sort of alimony payment for a finite period of time. Some states also permit a lump-sum alimony instead of or in addition to periodic payments.
All states require child support, so we’ll deal with that first.
The courts will always protect the children. Minor children need support. There are very few exceptions. The court will order child support to be paid until the child reaches majority, unless the child becomes self-supporting before then.
Virtually every state has statutory child support guidelines. The guidelines specify an amount of support that is presumed to be appropriate. Most states’ child support guidelines are based on the number of children and the earnings of each of the parents. Usually the parents are expected to share the burden of supporting the child.
What if one parent is earning income and the other is not? Virginia answers that question by taking into consideration the earning capacity of each parent. For example, could the wife who stays home be working? Maybe not if the children are under school age, but what about when they are 12 years old? Courts will not order a spouse to work. That would be unconstitutional involuntary servitude, but a court can make a support award that leaves a stay-at-home parent financially short if he or she doesn’t do something to supplement his or her income.
The guidelines, in Virginia at least, only go so far. If there are work-related childcare expenses, or uninsured or extraordinary medical expenses, these can be added to the child support burden.
Needless to say, how many days you spend with the child can also be a factor. Some costs, like housing, may be incurred whether the child is with one parent or the other. Other expenses, such as food and transportation, are most likely borne by the parent who has the child with him or her. The child support figure may be modified by the court to allow for the fact that custody of the child, and therefore expenses for the child, are being shared.
Here is another very important point. Since most of the college years occur after a child has reached age 18, your state may or may not require a parent to pay for college expenses. Check the law in your state.
In the world of support, money flows downhill. The parent with the larger income can expect to have to pay. An obvious exception is when the parent who earns the most has primary custody of the child.
Alimony or Spousal Support
It goes without saying that, in addition to child support, alimony is a major issue in divorce cases. The term “spousal support” is now used instead of the word “alimony,” but the terms mean essentially the same thing and can be used interchangeably.
As with all areas of the law, see what your state laws say. Many states have some form of spousal support, but it is obviously critical to determine whether it is “permanent,” temporary (for a finite period of time), “rehabilitative,” or lump sum. Let’s define these terms. The scariest one is “permanent support.” It isn’t really permanent, but it can last a very long time. Permanent support means that support is paid until either party dies or the spouse who is receiving the support remarries. There can also be statutory provisions for termination of support if the spouse who is receiving it enters into a “relationship analogous to marriage.” If you catch the meaning there – those are nice words for shacking up.
In Virginia, if your marriage is of long duration, you may very well have to pay permanent alimony. Long duration is not really defined in our statutes, but if you have been married for 20 years or more, consider that to be long duration.
The duration of alimony payments can be limited to a “temporary” period, such as only as long as the divorce suit is pending. Alimony can also be “rehabilitative.” That is, it can be limited to some finite period of time that the court determines is sufficient for the spouse who is receiving it to get back into the job market. As before, the court cannot order a spouse to work, but when that alimony stops, the money has to come from somewhere.
Voluntarily Unemployed or Underemployed – It’s Impact on Spousal Support
When these support issues are litigated, if either party claims that the other is “voluntarily unemployed” or “voluntarily underemployed,” you have to present evidence to the court so that the judge can determine what, if any, income should be imputed to the unemployed (or underemployed) spouse when child support and alimony are calculated. This can involve hiring a vocational expert to testify what jobs are available for that person.
“Underemployed” most often means that someone is working but perhaps only part-time. Or, as reported in one Virginia Supreme Court case, the husband has a well-paying job, but he quits and goes on a long vacation just to spite his wife (Canavos v. Canavos, 139 S.E.2d, 825 (1965)).
Another Virginia case shows how the issue can be even more difficult. A physician who was on the teaching staff at a medical school admitted that he could double his income by leaving that position and engaging in private practice. The court said, in essence, “You can remain in the lower-paying job if you want to, but you cannot reduce the support you pay to your family” (Butler v. Butler, 227 S.E.2d, 668 (Va. 1976)).
The stay-at-home parent is the one most often considered voluntarily underemployed or voluntarily unemployed. It may have been a good idea for a mom to stay home while the children were preschool age, but when the kids go off to school, a court may determine that her remaining at home is less necessary.
Suppose that a mom, with her bachelor’s and graduate degrees, is working two days a week at Barnes and Noble. Unless the children have extraordinary special needs, the court is likely to find her voluntarily underemployed. Again, the court will not compel her to work, but there may be an amount of support ordered which will force her to choose more work or less income.
To prove that your spouse’s earning capacity exceeds her actual earnings, it is often necessary to hire a vocational expert. The expert testimony will be to the effect that there are full-time jobs in the same geographical area that your wife is qualified for and the additional earnings would be “X” amount of dollars. This “imputed” income will be taken into consideration in calculating support. Additional evidence to prove imputation of income can be the underemployed (or unemployed) spouse’s previous employment. If she was making $75,000 a couple of years before, the court will take that into consideration.
Taxes Consequences of Child Support and Alimony
In most cases alimony is tax deductible to the payor and taxable to the payee. You can sometimes work out a nice little bracket shift that will have the effect of lowering the overall family federal income tax. Child support, however, is not deductible and not taxable to the recipient.
Keep in mind that the amount of child support and alimony awarded by the court is intended to be enough to support the children and the spouse. Based upon what was spent in the past, you can probably do a spreadsheet of the expenses for your spouse and the kids.
The court will consider your income as the other end of the measuring stick. If you have been making several hundred thousand dollars a year and the family has been living like royalty, do not think that the court will cut them back to subsistence level. There can be a hefty support award. I often hear the one who is ordered to pay it, say that it is too much. Just as often the spouse who receives it says he or she cannot possibly survive on that amount. Suffice it to say that both husband and wife may have to tighten their financial belts.