Alimony is a periodic payment by one spouse for the support of the other. Maryland recognizes two types of alimony – rehabilitative alimony and indefinite alimony. Rehabilitative alimony is awarded for a specific and limited period or time and in an amount sufficient to assist the recipient spouse in becoming self-supporting. Maryland courts have a preference for awards of this kind. However, alimony for an indefinite period may be awarded if, after a recipient spouse makes as much progress as can be reasonably expected toward becoming self-supporting, his or her post-divorce standard of living will be unconscionably less than that of the paying spouse. Indefinite alimony can also be awarded if the recipient, because of age or infirmity, cannot reasonably be expected to make substantial progress toward becoming self-supporting.
In a contested case, the court must decide whether to award alimony and the amount and duration of an alimony award, after considering a number of factors specified in the governing statute, including:
- age and health of the parties
- marital standard of living
- each spouse’s earning capacity
- financial circumstances and resources of the parties
- length of the marriage
- circumstances leading to the parties’ estrangement
- contributions, both monetary and non-monetary each spouse made to the well-being of the family
- time necessary for the recipient to gain sufficient education or training to enable that spouse to find suitable employment
- ability of the party from whom alimony is sought to meet his or her own financial needs while meeting the needs of the party seeking alimony.
Alimony awarded by a court is modifiable, which means it can be changed in certain circumstances such as a material financial change, both in amount and duration.
Generally, alimony terminates upon the remarriage of the alimony recipient, the death of either party, or on a specific date set by the court or the parties in an agreement. Additionally, unless the parties agree otherwise, alimony can also terminate if the court finds that termination is necessary to avoid a harsh and inequitable result.
Spouses who settle their alimony claims in a written, signed agreement can agree that alimony be fixed and not modifiable – whether in amount, duration, or both – and can customize the amount, duration, modification, and termination of alimony payments in ways the court cannot.
Alimony can be paid by direct payments between the spouses or ex-spouses or by earnings withholding order, which is basically a wage garnishment, from the payor’s employer.
Alimony can have significant tax consequences for the recipient and the payor, as in certain situations alimony can be deductible by the paying spouse and taxable to the recipient spouse.
The attorneys at Dragga, Hannon, Hessler & Wills LLP are experienced in seeking alimony awards in court, customizing alimony settlements to the unique circumstances, modifying and terminating alimony awards, as well as collecting and enforcing alimony awards. This experience includes working with clients, whether recipients or payors, to protect their financial interests in light of potential tax consequences and safeguards against future economic uncertainty.