Once the emotion is removed from a divorce situation, it basically amounts to negotiating a business deal. Part of those negotiations for some New Jersey couples who are divorcing involves alimony. But even in the best of circumstances, negotiating a divorce settlement is rarely easy, especially with relatively new tax laws in place, which has meant changes in the ways payors and payees of alimony look at things.
Judges look at a number of factors when considering support payments. When it comes to spousal support or alimony and child support payments, both New Jersey payors and payees should know what those factors are moving forward in a divorce process. Usually, a family court judge will look at both earned and passive income to come to a support payment decision.
People in New Jersey who are supposed to pay child and spousal support may be concerned about how they will afford these payments and their cash flow. In some cases, it may be possible to lower spousal support payments by offering a spouse a larger share of the marital property. People may also consider the timing of filing for divorce. For example, they might want to delay filing if they anticipate a slow income year ahead to ensure that year will be included in salary calculations.
Typical issues that must be resolved during a divorce include child custody, child support, the division of property and alimony. The purpose of alimony, also known as spousal support, is to limit the economic impact on a spouse who is a non-wage earner or a lower-wage earner by providing financial support to that spouse.
Starting on January 1st, 2019, couples getting a divorce in New Jersey will have to be mindful of new rules regarding alimony and taxes if spousal support will be an issue. In a nutshell, payers will no longer be able to deduct their payments for tax purposes. Also, recipients will not have to report their spousal support payments as income. However, some smart planning may minimize financial concerns for couples not able to beat the clock and get their divorce in before the changes take effect.