Commonly referred to as alimony is money paid by one former spouse to another to assist with the former spouse’s financial needs.
What is Spousal Support?
Spousal Support, commonly referred to as alimony is money paid by one former spouse to another to assist with the former spouse’s financial needs. Spousal Support is generally calculated based on the length of the marriage and the income or earning capacity of both parties as well as factors that are outlined in the Family Code. The length of the marriage determines the duration of spousal support. Spousal support can also be modified or terminated by further orders from the court.
To prepare for the calculation of spousal support, it is important to gather documents such as Tax Returns, W-2s, pay stubs, or any other documents that show income for both parties. There is also the consideration of the request for temporary spousal support prior to the finalizing the divorce. In the state of CA, spousal support is awarded on a case by case basis. There are several factors that are taken in consideration when awarding spousal support.
Do You Qualify for Spousal Support?
California Family Code § 4320 sets for the circumstances to be considered in ordering spousal support
In ordering spousal support under this part, the court shall consider all of the following circumstances:
The extent to which the earning capacity of each party is sufficient to maintain the standard of living established during the marriage, taking into account all of the following:
(1) The marketable skills of the supported party; the job market for those skills; the time and expenses required for the supported party to acquire the appropriate education or training to develop those skills; and the possible need for retraining or education to acquire other, more marketable skills or employment.
(2) The extent to which the supported party’s present or future earning capacity is impaired by periods of unemployment that were incurred during the marriage to permit the supported party to devote time to domestic duties.
The extent to which the supported party contributed to the attainment of an education, training, a career position, or a license by the supporting party.
The ability of the supporting party to pay spousal support, taking into account the supporting party’s earning capacity, earned and unearned income, assets, and standard of living.
The needs of each party based on the standard of living established during the marriage.
The obligations and assets, including the separate property, of each party.
The duration of the marriage.
The ability of the supported party to engage in gainful employment without unduly interfering with the interests of dependent children in the custody of the party.
The age and health of the parties.
All documented evidence of any history of domestic violence, as defined in Section 6211, between the parties or perpetrated by either party against either party’s child, including, but not limited to, consideration of:
(1) A plea of nolo contendere.
(2) Emotional distress resulting from domestic violence perpetrated against the supported party by the supporting party.
(3) Any history of violence against the supporting party by the supported party.
(4) Issuance of a protective order after a hearing pursuant to Section 6340.
(5) A finding by a court during the pendency of a divorce, separation, or child custody proceeding, or other proceeding under Division 10 (commencing with Section 6200), that the spouse has committed domestic violence.
The immediate and specific tax consequences to each party.
The balance of the hardships to each party.
The goal that the supported party shall be self-supporting within a reasonable period of time. Except in the case of a marriage of long duration as described in Section 4336, a “reasonable period of time” for purposes of this section generally shall be one-half the length of the marriage. However, nothing in this section is intended to limit the court’s discretion to order support for a greater or lesser length of time, based on any of the other factors listed in this section, Section 4336, and the circumstances of the parties.
The criminal conviction of an abusive spouse shall be considered in making a reduction or elimination of a spousal support award in accordance with Section 4324.5 or 4325.
Any other factors the court determines are just and equitable.
What is a Long Term Marriage and how does that impact Spousal Support?
In California, a marriage that is over 10 years is considered to be a long term marriage. What this means for spousal support cases is that a court retains spousal support jurisdiction indefinitely unless an agreement or order specifically provides otherwise. In a marriage that is less than ten years, spousal support is generally awarded for one half of the length of marriage depending on the other factors that are set forth above.
This does not mean that a spouse will receive the maximum amount of support for the rest of their life. The Court will look at all spousal support factors when determining the length of the Spousal support awards.
In considering the supported spouse’s ability to engage in employment, the court may use “step down” orders, which will gradually decrease the amount of support over time, taking into account the increased earning capacity of the supported spouse. For example, if there is a couple that is married in their twenties and then divorces in their thirties the court will look at how long it will take the supported party to establish themselves in a career. If this couple remained married for 30 years and then divorced in their 50’s the court may determine that the supported spouses ability to engage in employment has been reduced due to the age of the party entering into the workforce.
In awarding spousal support, the court must consider the goal that the supported party become self-supporting within a reasonable period of time. Additionally when making an order for spousal support, the court may advise the supported spouse that he or she should make reasonable efforts to assist in providing for his or her support needs. This is commonly known as a Gavron Warning which indicates that the failure to become self-supporting may be grounds for a change in circumstances to modify or terminate the spousal support award.
The court will also look at the supported spouses work history during that long term marriage. A spouse that works for 9 years of the marriage and is only unemployed for the last year of the marriage will have an easier time entering the work force than a spouse who has never been employed.
A court might also order payment of support for a fixed period but require the supported spouse to show good cause why support should be continue beyond the period. This is commonly referred to as a Richmond Order. It may also order support that contains an automatic “step-down” in the amount of spousal support paid.
Even in cases where there has been a long term marriage the supporting party may request that the court modify support based on a change in circumstances. This change may simply be the failure of the supported spouse to engage in gainful employment and the failure to take the efforts that are necessary to become self-supporting.
Spousal support is often a highly litigated issue as spouses do not wish to continue to support each other for an indefinite amount of time after the marriage is terminated. Therefore in cases where spousal support is ordered at the time of the Judgment, often a spouse will come back in a couple of years to modify the amount or seek to eliminate the spousal support altogether.
How do separate property assets come into play when looking at Spousal support?
The first defense against a long-term spousal support award is that the requesting party does not need support because his or her estate after judgment is sufficient to meet her needs. There are several cases which deal with the sufficiency of a spouse’s separate property to eliminate any support entitlement.
Courts have that in assessing whether a supported spouse’s separate estate was sufficient to meet their needs and eliminate a support order, the court could consider the principal of the estate, not just the interest or other income earned from the assets.
The courts will also look at the supported spouse’s share of the community estate and determine if the spouse can be supported from their share of the assets in the community estate.
In cases where a party does not work and is living off of their assets, the Court may look at the income that is generated by those assets and use those to determine the marital standard of living and may base support off of the separate property assets.
This is also used in matters where one of the spouses leaves their employment and choses to remain unemployed. Family law courts are a court of equity therefore they will look at the assets in determining the ability to pay support as well as the need for support.
What is the marital Standard of Living and how does that impact the payment of Spousal Support?
In California past cases have held that the marital living standard is the starting place for all long-term spousal support orders. For post Judgment matters, the importance of the marital standard of living usually declines after time has passed from the date of separation.
In most cases the parties will not have enough resources available for the payment of support to allow both of them to maintain the marital standard of living. The court must make a reasonable award of support that allows both parties to enjoy a similar lifestyle as each other even if this is not actually the marital lifestyle.
The “marital standard of living” can generally be defined as “reasonable needs commensurate with the parties’ general station in life.” When looking at a Spousal Support case on all of its factors the ‘marital standard of living’ is intended to be a general description of the station in life the parties had achieved by the date of separation meaning an upper, middle or lower income. The courts will look at the income not the expenditures as they are not going to base support on a lifestyle where the parties expenses exceed the income and cause them to continue to incur debt.
In cases that there is a significant amount of income that is received from bonuses or commissions the Court will generally assign a percentage of those to the supported spouse.
How does a commission job impact Spousal Support?
The case that is used by Family Law Courts in determining Spousal support in cases where a spouse has significant bonuses or commissions as part of their income is a case called In re Marriage of Ostler and Smith.
One of the issues is that commissions may be non-existent one month and be higher in the next month. In attempting to annualize this and come to a number that is paid on a monthly basis based on a speculation that a spouse will receive bonuses or commissions, the supporting spouse may be at a disadvantage in several months and there will be a windfall to the supported spouse. In the event that the spouse paying support receives a significantly larger bonus than anticipated, the receiving spouse would not get the benefit of that bonus. Therefore the family law courts have set forth a method where the supporting spouse pays a percentage of income to the other spouse.
When using this method the monthly spousal support is geared to the actual, predictable cash flow available for support, and the supported spouse shares proportionally in the unpredictable income. When using a perccentage basis for support it is common to adopt a maximum number to be assigned to the bonus which is based on the available income during the marriage.
There are some circumstances where both spouses receive commissions and bonus income as part of their pay structure. In these cases, a two way bonus calculator will be used so that the bonus paid will be offset by the bonus or commission that is received by the supported spouse.