Although all divorces may have some things in common, each case is unique depending on the couple. Some spouses mutually agree to legally end their marriage while in other cases, one partner is blindsided by the breakup. Typically, there are several issues that must be addressed before the divorce is considered final. According to Illinois law, marital property is subject to equitable distribution, which means possessions are divided fairly but not exactly 50/50. This also includes any outstanding debt the couple may have acquired throughout their marriage. Another aspect that is considered is whether one spouse is entitled to spousal maintenance or support, which is also known as alimony. Financial support of this nature allows one party to maintain a certain standard of living after the divorce until he or she can secure employment and become financially independent.
Spousal Support Guidelines
As of January 1, 2019, the rules governing spousal maintenance in Illinois changed. If a couple cannot reach an agreement on spousal support payments, then the court will get involved. The court will consider all relevant factors to come up with a duration and an amount that is appropriate, including the length of the marriage, each party’s income level, as well as his or her future earning potential....
If you are facing the possibility of a divorce, you and your spouse will need to address a number of important considerations along the way. For example, one or both of you will likely need to find someplace to live. If the two of you have children together, a parenting plan will need to be developed that includes arrangements for the allocation of parental responsibilities and each parent’s parenting time. Simply adjusting to everyday life as a single person is likely to present challenges in and of itself. However, many of the most difficult concerns in any divorce tend to focus on a couple’s finances, including how their marital property will be split and whether either spouse should expect spousal support payments.
Property Division and Maintenance Considerations
The Illinois Marriage and Dissolution of Marriage Act (750 ILCS 5) provides that decisions about money and property in an Illinois divorce are to be made based on the circumstances of each unique case. If you and your soon-to-be ex-spouse cannot come to a settlement agreement, it will be up to the court to identify and divide the marital estate, as well as to decide if there is a need for spousal support – known in the law as “maintenance.” In making these decisions, a family court judge is required by law to consider a variety of factors related to each. Such factors include:
- Each spouse’s income, earning capacity, and available resources
- The role each spouse played during the marriage, how that role affected the value of the marital property, and its effect on the earning ability of the other spouse
- How long the marriage lasted and the standard of living established in the marriage
- How maintenance and allocated property will affect each spouse’s tax obligations
- How parenting responsibilities are being divided
- Any valid agreements between the spouses, including prenuptial and postnuptial agreements
Putting the Pieces Together
Illinois law also directs a presiding judge to take into account the overall financial situation present during the marriage, as well as in the pending divorce. It is important to recognize that the asset division process and spousal support determinations are not independent considerations. In fact, the law specifies that each might affect the other. For example, if you have asked for spousal support in your divorce, and the court is deciding on how to divide your marital estate, the judge is statutorily obligated to consider whether property should be given to you “in lieu of or in addition to maintenance.”...
The completion of divorce proceedings has an air of finality. The marriage is officially over, the sometimes long and drawn out divorce process is finished, and both parties can move on with their lives. However, just because a divorce is final does not mean those involved will live by their divorce decree forever. Like everything else in life, the terms of a divorce often change, sometimes years after they were finalized.
Remarriage is one of the biggest reasons the terms of a divorce will change. When one of the ex-spouses gets remarried, both parties will want to consider how spousal maintenance and child support will be affected.
Remarriage and Maintenance in Illinois
Generally speaking, when a person who is receiving maintenance gets remarried, their former spouse will no longer be required to pay alimony. The only exception is when the two parties have come to another agreement. The person making alimony payments can stop doing so upon the date of the remarriage. They do not have to return to court or ask for an order of termination of support....
Getting divorced may be the right move for the health and happiness of both spouses, but financially, this decision can be devastating. The divorce process itself is expensive for many couples, and rearranging finances after years of sharing responsibility is no easy task. Making this transition is extremely difficult for all spouses, but those facing financial disadvantages are at risk of suffering irreparable fiscal damage by leaving the marriage. Spouses in this situation may have the option of asking for spousal maintenance (formerly known as alimony) from the other spouse if his or her financial means are more lucrative and stable.
Spouses who are returning to work after years or decades of absence will likely struggle to maintain an acceptable standard of living post-divorce, and decisions about spousal maintenance are frequently settled via negotiation or mediation. However, resolving this matter is about to get much more complicated and volatile, as a new tax law goes into effect on January 1, 2019, that will completely upend the treatment of spousal support. This change will greatly disincentivize a paying spouse from agreeing to this support, and it will greatly increase the likelihood of litigation to determine whether alimony will be required.
Paying spousal maintenance is a significant financial burden for most people. Under the current tax laws, a person may deduct alimony payments from their federal income taxes, thereby reducing the payor’s overall tax liability. The former spouse receiving spousal support is currently required to report this money as income....
Anyone who is currently paying alimony (legally referred to as spousal maintenance in Illinois) or considering this issue in the midst of divorce is likely aware that as of 2019, the tax rules for this obligation will change dramatically. Currently, the payor receives a deduction for this expense, and the recipient is required to report the payments they receive as taxable income. This arrangement relieves some of the financial burden this support can cause, which can serve to facilitate divorce settlement negotiations. However, under the recent federal tax reform laws, both the ability to deduct alimony and the need to report it as income will be eliminated for any divorce finalized on or after January 1, 2019.
Legal and financial analysts worry that this change will drastically increase the amount of conflict between spouses and greatly deter the payor spouse from agreeing to any type of ongoing spousal support. Recognizing the significant issues this change will introduce into the divorce process, Illinois lawmakers passed a new law this year that allows for adjustments to modification awards in hopes of making the transition under the new tax law easier. A discussion of the changes in Illinois alimony law will follow below.
New Baseline Spousal Maintenance Formula
Alimony is always a contentious issue in divorce, as the spouse asked to pay rarely has any desire to support an ex-partner once the relationship is severed. Further, unlike child support, which is the legal right a child holds until adulthood, alimony is essentially discretionary, and courts must determine if such support is appropriate before moving forward. To make this assessment, a long list of factors must be evaluated, and if the request is granted, the amount and duration of spousal support must be calculated....
When a judge issues a spousal maintenance or spousal support order, one spouse must pay a certain amount of money on a regular basis to the other spouse. You only receive maintenance if the judge decides that you need it and your spouse has the ability to pay it. The Illinois Marriage and Dissolution of Marriage Act (IMDMA) contains uniform guidelines for spousal maintenance orders in Illinois divorce proceedings. The goal of the guidelines is to make spousal maintenance awards in divorce more consistent and to let you know what to expect if you get spousal maintenance in your Illinois divorce.
Application of the Spousal Maintenance Guidelines
The spousal maintenance guidelines apply only when the judge already decided that maintenance is appropriate. To determine whether spousal maintenance is appropriate in your case, the judge must consider several factors, including the following for both parties:...
After months — or even years — of legal wrangling, your divorce is finalized and you and your ex-spouse are now free to move on with your lives. However, if either of you were ordered to pay alimony, or if there are children involved, there are tax issues related to the divorce to which you need to be aware. In fact, you may need to revisit these issues as circumstances change.
Common Tax Issues Faced by Couples Once a Divorce is Finalized
Filing status. Your marital status on December 31 determines your options regarding filing status for tax purposes. If your divorce is finalized before the end of the year, you may want to file as head of household rather than as a single person. You can file as head of household — and get a bigger standard deduction — if you had a dependent living with you for more than half the year and you paid more than half of the upkeep on the marital home. An attorney and accountant can advise you whether it is to your advantage to file as head of household or as an unmarried person....