By Manuel Tovar, September 06 – Hispanic Solutions Group
Today we give you some scopes on what you need to know to negotiate alimony, which is the main part of a divorce.
Developing an alimony agreement between two people who loved each other is one of the least pleasant experiences in life. But a little preparation and advance research can make the process much easier, albeit painful for the protagonists and the family.
According to some statistics, it is very likely that many of us will find ourselves involved in alimony negotiations at some point. It is known that in Western cultures, more than 90% of people marry before the age of 50, according to studies by the American Psychological Association. And in the United States, between 40 and 50 percent of married couples eventually divorce.
Negotiating alimony (also known as alimony or spousal maintenance), as part of a divorce, can be stressful, overwhelming, and full of emotions for both parties involved and their families.
Today we hit you with some important points to keep in mind when it comes to alimony settlements, as well as tips to help you come up with an alimony figure that makes sense and begin negotiations well informed and mutually agreeable.
1. You don’t stop doing your research
There is a wealth of information online designed to help divorce parties resolve the many questions surrounding alimony. Taking the time to read some of the information available can be a useful place to start.
Not only do alimony laws vary from state to state, one of the most comprehensive places to start is MaritalLaws.com, which not only includes a state-by-state analysis of alimony laws, but also offers a calculator of alimony that allows users to enter information such as the gross and net of the payer and the beneficiary, salary and the duration of the marriage, in order to develop an approximate number of alimony.
We inform you that the website does not delve into what alimony is, how it is affected by taxes and more. Also, the other sister site, DivorceNet, does not cover the best way to assess a spouse’s resources and needs.
2 Trade yourself as if your life depended on it, because it usually does.
Specialist Jeffrey Knipmeyer, who is the Director of a Chicago-based family law firm, believes that in addition to understanding the laws and parameters at stake in alimony negotiations, it is essential to think realistically about your needs with Regarding such financial support, “The baseline for any support, be it alimony or child support, is an estimate of the amount of the guideline to which one is entitled under statute, based on income and income. financial resources of each party, “Knipmeyer explained. “However, for most people, a better indicator of the amount of support that will be required is the needs of that party.”
In theory, the calculations of the legal support guidelines would be adequate to meet the needs of the spouse. But in reality, that is rarely the case, continues Knipmeyer. As a result, it is important that you and your attorney (if you have one) truly understand money needs and actively negotiate to meet those needs, rather than simply accepting guideline calculations. “Having an accurate budget for your daily expenses can be invaluable in doing this,” says Sarah Jacobs. future”.
3 Alimony for stay-at-home parents
Chicago-based attorney Derek Bradford and founding partner of a family law firm says, “Stay-at-home parents often have concerns of their own when it comes to seeking divorce and alimony.” “I can’t tell you how many people who stay with their parents, particularly moms, are afraid to file for divorce because their spouses have threatened to take everything away from them. The reality is that this really can’t happen,” says the aforementioned lawyer. “The current statute in Illinois, which is similar in most states, states that everyone has an obligation to try to be financially independent. Most moms will eventually have to find employment. But for families that have the means,
4 Is alimony taxable?
When it comes to taxes and alimony, there is good news and bad news. The federal tax code related to alimony changed on January 1, 2019, Jacobs says. At that point, the tax deduction for the party paying alimony was removed, which is not very good if you were the one affected by the removal. The law also removed the taxable nature of alimony payments for the recipient. Which means that those who receive alimony payments no longer pay income taxes (that’s the good news). However, those changes only affect federal taxes.
“Each state can handle it differently at the state level,” adds Jacobs. “For example, in New Jersey, alimony is still tax deductible for state tax purposes.”
5 Options for negotiating and structuring alimony
Going straight to court is not the only way to handle alimony negotiations. And it may not be the best way. Mediation may provide a more acceptable alternative to some; This approach provides the assistance of a professional mediator who can work with both parties to structure an agreement that works for everyone involved, said specialist Erik Wheeler.
Additionally, just as there are various approaches to alimony negotiations, there are also various options on how to structure the final settlement. As the NOLO website explains, the range of options includes receiving a one-time payment, recurring monthly payments, or even a transfer of ownership. “People sometimes get stuck negotiating a fixed amount, but there are many other possibilities,” explains Wheeler. “For example, if the payer estimates that cash flow will be reduced in the first two years after the divorce, but will improve later, the payments could be structured as a lower monthly payment for the first two years and then increase over the years. following “. “Or depending on your financial circumstances, you may want to consider paying a lump sum for alimony. This could be paid up front or it could happen later, “Wheeler continues.
Those who do not have enough cash or assets to pay alimony, but have equity in a home, could also consider a home cash refinance to pay the lump sum. Alternatively, Wheeler says, you may be able to negotiate reduced alimony in exchange for a different allowance from the other marital property – there are many good reasons why you may want to consider a lump sum alimony payment up front, Attorney Gabrielle Harley said. “For example, if you are getting divorced from someone who is likely doing everything they can to evade payment, or who is earning inconsistent income, it may be in your best interest to receive an advance payment,” Hartley explains. “Also, usually, alimony ends when you cohabit or remarry. However, if you accept an advance payment or specifically state that the alimony is non-modifiable, you can guarantee payment regardless of the change in circumstances. “
6 Note the big picture
Finally, when it comes to creating an alimony agreement that both parties are comfortable with, it is important to keep a broad perspective, including all elements of the asset division, not simply spousal support payments. “Do not consider an aspect in a vacuum,” explains specialist Jacobs, “If a client of mine is only focused on support, whether it is alimony or child support, I try to gently guide him to look at the whole financial picture, which it can include home equity, retirement accounts, college savings, and more. “
Having an experienced family law attorney who has relationships with financial advisers and similar professionals can be very helpful.
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