Now that you are starting to take the first steps to move forward with divorce, do you expect the judge to include spousal support as part of the divorce decree? A Cook County judge is going to examine certain factors in making an alimony determination. For example, the court might examine the property each of you will walk away with when the divorce is final, your earning capabilities, the length of your marriage, and even your health and mental condition.
Once the court makes its decision regarding the need for alimony, it will then make a determination on how much alimony you should receive and for how long. Judges usually make this decision based on the particular circumstances of each case. If you do not want to be saddled with depending on monthly alimony payments, there may be an alternative available. If the court and your future ex-husband agree, you may be able to take a single lump sum alimony payment.
Choosing to make a lump sum payment
Some states will allow individuals to make a lump sum alimony payment as long as the amount is equal to the total of the combined monthly payments. This means, if the payor has the money to do so, a judge might approve a request to make a single alimony payment.
Receiving a lump sum payment
There are several benefits to receiving a lump sum alimony payment. For example, you may get more money overall. By opting for a lump sum payment, the money will not be subject to possible future declines the value of it. When you accept alimony on a monthly basis, it will be subject to economic changes such as inflation and deflation. In addition, by receiving the money as soon as possible, it gives you a chance to invest it and, thereby essentially increasing its value.
Another reason to take a lump sum payment is that you will not have to worry about your ex-husband missing payments. When an individual stops making alimony payments, the receiving party typically has to go to court and request an order to force the payor to continue making payments. Unfortunately, this is still no guarantee that your ex will make the payments. By having the total amount of alimony up front, you can skip the hassle of making another trip to the court house to obtain a judgment and try to force payment.
Tax consequences
When you receive alimony, either in a lump sum or as monthly payments, there are tax consequences. If you receive a lump sum payment that come with the label “alimony,” you may be subject to federal income for the full amount in the year you receive it. However, if your divorce decree labels the money as a “settlement,” you may be able to avoid the tax consequences.
As you begin the divorce process, your attorney will be your best source of advice when it comes to working out a fair divorce that includes property division, custody issues and alimony.
