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The first step in ensuring a fair alimony judgment in Wisconsin is filing the right action

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How Courts Determine Alimony Orders

Alimony is money paid from one spouse to another in order to even out potential economic effects after a divorce. Sometimes referred to as maintenance or spousal support in Wisconsin, alimony ensures that as individuals, neither person is better off than the other and can both continue having the standard of living they are accustomed to.

The legal basis for alimony is to establish financial equality between divorcing parties. A typical example is where one party gives up their career to be a home maker to enhance the ability of the other party to chase higher career levels. Depending on the length of the marriage the court will determine the type and extent of alimony.

  1. the length of the marriage (typically 10 years is the magic number)
  2. age and physical and emotional health of the parties
  3. division of property orders (if there is a significant amount of separate property the court may award alimony in lieu of property)
  4. educational level of each party at the time of marriage and at the time of divorce
  5. earning capacity of both parties, educational background, work experience, absence from the job market, custodial responsibilities for children, and expenses necessary to acquire appropriate employment
  6. likelihood the party seeking maintenance can become self-supporting
  7. tax consequences to each party
  8. mutual agreements made by the parties before or during the marriage
  9. contribution by one party to the increased earning power of the other

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Things You Should Know Before You Proceed

Tax Implications of Alimony Payments

Whether paying or receiving alimony payments there are tax implications you should know. Alimony is taxable income for the person receiving the payments and a tax deduction for the person paying. (Child support, unlike alimony, is neither taxable nor tax deductible.)

There are instances where alimony can be classified as nontaxable and nondeductible. Either way, alimony is set up so both parties need to classify the support payments the same way. In other words, one person can't claim the alimony payments as a tax deduction, while the other spouse claims the income as nontaxable.

Receiving Support Payments

There are some tax implications one needs to consider if they are receiving alimony. When you get paid from an employer, they withhold taxes for you, however, your spouse will not when writing the support checks. Therefore you'll need to withhold taxes from alimony checks yourself.

One way to ensure this remains manageable is paying estimated taxes each quarter. This helps avoid a large tax bill at years end. Another option is to increase the withholding amount from your paycheck. However you handle the additional income is up to you, but taking action is better than waiting for the bill on April 15th when you file taxes.

IMPORTANT: If your spouse pays support by paying your expenses (such as mortgages, car insurance, car payments, student loans, etc) on your behalf, these payments will be treated as income and need to be included on your income taxes.

Paying Spousal Support

If you pay alimony, these payments can be deducted from your taxable income on your yearly tax return. This is only for alimony payments; child support and property distribution are not tax-deductible.

The IRS is very picky when it comes to support payments, especially in the first year. They scrutinize the payments to ensure property distributions and other post-divorce expenses are not included as deductible.

IMPORTANT: Agreements calling for larger payments at first and smaller payments later will be scrutinized more thoroughly. The IRS at times will assume these large upfront payments are in lieu of property or something else. They get particularly aggressive if your agreement calls for a $15,000 reduction or more in support after the first three years.

Another important consideration that should be made when negotiating support payments is ensuring you DO NOT tie the end date of your payments to anything relating to your children (like moving out or finishing college). If audited the IRS may view the support payments as child support instead, which is not tax deductible.

REMEMBER: When making payments to third parties (such as mortgage payments, car insurance, car payments, student loans, etc) for the party receiving alimony these payments should be considered direct payments to them. These payments should, therefore, be included on your income taxes as a deduction.

Duration of Spousal Support in Wisconsin

When there is a divorce, there is usually a lot of debate about how much the payments will be and for how long the payments need to be made. There's a good chance this will be the most contested aspect of your divorce proceedings. But even after an agreement has been made, you might not be completely in the clear as it could come back to haunt you down the road when one spouse wants to modify the alimony payments or end them all together.

Since alimony payments are court ordered, they can't be modified or terminated at the discretion of one of the spouses. However, if a spouse can make a case and show that circumstances have changed substantially since the original alimony ruling, it is possible the payments can be modified.

Here is a list of factors the court could take into consideration for changing or terminating alimony payments:

  • Increases or decreases in salary
  • Job losses or new job opportunities
  • Major change in cost of living
  • Ex-Spouse moving in with a new significant other
  • Major inheritances

The reasons to terminate alimony are generally much easier to prove. There are two main causes for alimony to be terminated: A death or a new marriage. If one of these two scenarios occurs, do not stop paying your alimony! Doing so could put you in violation of the agreement. Instead, notify the courts of the recent events as soon as you know about them. Show proof of the event and get a court order that allows you to discontinue your alimony payments.

Equal Protection Clause 

The Fourteenth Amendment, specifically the Equal Protection Clause, was set up in 1868 to protect every individual equally by the laws established in the United States. While the Equal Protection Clause has been around for a long time, only recently have courts applied it to alimony cases.

In the past, sex wasn't considered in alimony discussions because men typically made more than their spouse so alimony always was paid to the female. But with women having an equal stake in the workplace, the Equal Protection Clause will prevent sex from being a factor and instead will force alimony cases to focus on the facts at hand.

Types of Spousal Support Orders in Wisconsin

Temporary Support

Temporary alimony will be support payments ordered by the court to be paid before the divorce is completed. This order will be determined during what is called a “Temporary Orders Hearing”.

Typically this alimony order occurs during longer divorce trials as a way for a lesser-earning spouse to have financial assistance while the divorce is pending. Once the divorce is complete, a different type of alimony will usually be ordered.

Permanent Support

As the title suggests, permanent alimony is alimony paid indefinitely. The only events that would stop permanent alimony from having to be paid are if one of the two spouses dies, or if the recipient ends up remarrying. Although rare, there may be instances where the recipient is still entitled to payment despite remarriage.

Even though this form of alimony is permanent, it doesn't mean that the amount paid is permanent. That can still fluctuate up and down based on changes of circumstances for the payer or recipient.

Reimbursement Support

Reimbursement spousal support is another temporary form of alimony. What sets it apart from temporary alimony is that it doesn't have a certain date in which it is terminated. Instead, it is paid until a predetermined amount is paid to the other.

Reimbursement spousal support was created to pay back a spouse for expenses that were the direct result of the other spouse. The most common example is to pay back the cost of higher education if one spouse worked to pay for the other spouse's education. The person who is responsible for paying the other spouse back can do it all at once in a lump sum or over an agreed upon period of time.

Lump-Sum Support

Lump-sum alimony is a form of alimony that is paid all at once instead of dealing with monthly payments over an extended period of time. Usually, lump-sum is a considered form of alimony in cases where a property settlement isn't an option. Lump-sum is a unique form of alimony in that it is even more permanent than permanent alimony. The reason being is that permanent alimony can still be modified when circumstances change in the former spouses' lives.

Lump-sum, since it's paid in full, doesn't factor in future events or circumstantial changes. Due to the permanent nature of it, you'll want to make sure an experienced family law attorney has worked with you on your case because the outcome can't be overturned for any reason.

Pick an Action to Begin Securing Alimony in Wisconsin

Secure Alimony during a Divorce Proceeding

Modify Alimony or Family Support Orders

Enforce Alimony or Family Support Orders

Terminate Alimony or Family Support Orders

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