Aside from custody issues, one of the most contested matters in a divorce proceeding is property division. As part of determining which party will be granted ownership of certain assets, courts often take into account whether one spouse will be required to provide the other spouse with periodic maintenance payments. Determining whether a spousal support award is appropriate can be a difficult matter to resolve and can also have serious financial repercussions for all parties, so if you are considering filing for divorce and have questions about how your marital property will be divided or whether you will be eligible to receive spousal support, please contact an experienced high asset divorce attorney who can help explain your legal options.

Establishing Eligibility

A party can only obtain spousal support if he or she can satisfy specific eligibility requirements. For instance, a party requesting support must provide evidence that he or she lacks sufficient assets to provide for his or her reasonable minimum needs and:

When it first took effect in very limited form in 1997, conventional wisdom held that the spousal support law would be gradually expanded until Texas joined the majority of the other states which, at the time, routinely included alimony payments in their high-asset divorce decrees. In many cases, these payments were designed to permanently equalize the standard of living between the ex-spouses, meaning that regular monthly payments continued for many years after the divorce was final, or perhaps even permanently.

But, in the past 20 years, Section 8 of the Family Code has only been broadened once. And, given the alimony rollbacks taking place in various states, the law may not be expanded again anytime soon. So, although some spouses are entitled to some additional support in some circumstances, the scope of Section 8 has probably not fulfilled the vision of its original drafters, and given the current political and economic climate, the law may never reach that level.

Eligibility

While many states are restricting their alimony laws under tremendous pressure from advocacy groups, Texas has expanded its spousal support laws in recent years, albeit not by much. As a result, spousal support is still rather difficult to obtain. In other states, alimony is an important element of almost every property settlement in a high-asset divorce, but that is simply not the case in the Lone Star State.

Needs Presumption

To receive any long-term support ("long term" being more than a few months), the requesting spouse must overcome two hurdles in Section 8 of the Family Code.

To promote a more effective property division in a high asset divorce, Texas courts recognize and enforce two different types of spousal support.

Statutory Maintenance

The Legislature enacted Section 8 of the Family Code about twenty years ago, with the apparent intent to expand the law over time. But that no longer seems to be the case, as the edict has been expanded only once, and the political winds are now blowing in the opposite direction – Florida, New Jersey, Illinois and several other states have all significantly scaled back their alimony laws in recent years.

A common stipulation in high-asset divorces is alimony, also known as spousal maintenance. Alimony is money that one spouse is court-ordered to pay the other spouse. Unlike child support, alimony is completely up to a judge's discretion. In September 2011, Texas HB 901 amended the rules regarding alimony in this state, including increases to the amount and length of time a spouse may be entitled to spousal maintenance.

Traditionally, there are two ways alimony payments can be made in high-asset divorces—either periodic alimony (which is paid on an established schedule i.e. monthly) or in a lump-sum payment. There are benefits and disadvantages to each of these two methods, and an experienced complex litigation attorney can help determine which is best for your situation.

In periodic alimony payments, the payments are typically set for a certain period of time. Usually, alimony payments will end if:

Under Section 215(a) of the Internal Revenue Service Code (IRC), the definition of spousal support for tax purposes is any cash payment which falls under the following:

• Spouses do not file joint income tax returns with each other;
• The divorce or written separation agreement does not state that the payment is not alimony;
• If legally separated or divorced, the spouses do not live in the same household when payments are made;
• There is no liability to make the payment (in cash or property) upon the death of the spouse receiving the spousal support;
• The payments are not treated as child support or a property settlement.

The IRS does allow the deduction of spousal support payments. However, in a recent case before the U.S. Tax Court, a judge ruled that a man was not allowed to take the alimony payments he made to his ex-wife as deductions. The court based their decision on what the IRS refers to as "child-related contingency."

The couple's divorce decree specified the alimony or spousal support payments would end under one of the following conditions:

Many factors contribute to determining spousal support in Texas. These support payments may also alter other parts of the divorce agreement, such as property distribution. If an agreement on this issue is unable to be reached between spouses in Texas, the District Court will order the spousal support considering many factors before making a final decision. The court must decide the amount, duration, the nature, and the style of the periodic payments that will go from one spouse to the other based on the following factors:

• The education level and job skills of each spouse

• The efforts put forth by the spouse seeking support to pursue available employment

• The ability to meet the personal needs of the spouse who must potentially pay the support

• The financial resources of each of the spouses

• The financial resources of the spouse who is seeking the spousal support, including any and all community and separate property liabilities given to that spouse in the divorce settlement, along with that spouse's ability to meet his or her own needs independently, without support

• The contribution of either spouse as a homemaker

• The earning ability, age, health condition and employment history of the support-seeking spouse

• Any contribution that one spouse may have made to the education or earning ability of the other spouse

• The length of time that the couple was married

• The division of all of the marital assets

• Pre-marital property of both spouses

• Marital conduct of the spouse that is seeking spousal support from the other

If you are going through a divorce, or are considering it, and may have to deal with spousal support, contact a divorce attorney for assistance. Attorneys at the Powers and Kerr, PLLC can help you in Austin, Tex. today.