Frequently Asked Questions About Alimony
What Is Alimony?
Alimony is a payment to a spouse or former spouse for the support and maintenance of the spouse. It can be ordered by a court or entered into by private agreement.
What Makes a Spouse Entitled to Alimony?
Alimony is based on need not fault. So long as a spouse has not committed pre-separation adultery which has not been condoned (forgiven) by the other spouse, a spouse who is dependent on the other for maintenance and financial support can receive alimony. However, marital misconduct and other factors can affect the amount and duration of alimony.
What Is Post Separation Support?
Post Separation Support is a form of temporary support paid to a dependent spouse by a supporting spouse. The purpose is to enable the dependent spouse to maintain that spouse’s station in life and to employ counsel to meet the other party at trial upon substantially equal terms.
How Does The Court Determine How Much Alimony Will Be Awarded?
Unfortunately, there are no guidelines set by the State of North Carolina to determine how much support to award. For this reason, each county has a different way to approach the issues of both amount and duration. The court needs to determine first, whether the person seeking support is a dependent and supported spouse. If it reaches that threshold, the court then determines the needs of each party based on the standard of living within the last 2 or 3 years of marriage and then determines the current need of each party and the ability of the supporting spouse to pay.
Once Alimony Is Awarded By the Court, Can it Be Changed?
A court order for alimony can set out both the amount and the duration of support. These amounts can be changed if there is a change of circumstances which make it necessary and equitable for the support to be changed, either by an increase, a decrease or a termination of the existing order. Alimony will cease by operation of law upon the death of either party, the remarriage of the dependent spouse, or cohabitation by the dependent spouse.
What If the Alimony Is in an Agreement, Not in a Court Order?
Often times parties will agree on an amount and duration for the payment of alimony in a separation agreement. The terms set out in the agreement are not modifiable unless a means to modify the award is set out in the agreement. Sometimes parties will agree on a specific amount or a specific length of time based on the fact that the award cannot be changed. Unless specifically stated otherwise, support will cease upon death or remarriage.
Who Pays Taxes on the Alimony?
Alimony is deductible by the payor spouse on the payor’s state and federal income tax and included as taxable income on the dependent spouse’s state and federal income tax return. While it is rare, some parties can agree in writing that the support will not be deductible from the payor’s income and taxable to the dependent spouse. An example of such a situation is where the income is tax free to the payor, so it would be inequitable to make the dependent spouse pay taxes on money which would be tax free to the payor spouse.