Alimony law in New Jersey, an overview
Alimony law in New Jersey is a complex, confusing, and emotional subject. The above video provides a general overview of the topic, the five types of alimony and their purposes, tax consequences, what factors into the amount and duration of the alimony, and touches briefly on the circumstances under which alimony can be modified or terminated. What follows is a transcript of the video:
“All right. I want to talk about alimony in New Jersey very broadly and generally. Now this is a subject that you can make hours of videos on, but I at least want to give a basic overview here because I’ve noticed that it’s a topic that causes a lot of frustration and confusion for many people. So I’m going to do a general overview and also talk about a lot of the misconceptions that people have. And I need to get this out of the way. The first misconception has to do with whether fault factors into alimony. In other words, whether it matters that the person seeking alimony was ‘the bad one’ in the marriage or is the reason for the divorce. And I have bad news for you, it does not matter. There are a lot of factors that go into alimony, but fault is not one of them.
And I get this all the time in my office. People want to come in and tell me how awful their partner is, and I’m sorry about that, but it’s just not a factor. You know, your wife cheated on you, she slept with some other guy. Honestly that’s horrible and you didn’t deserve that and I’m sorry, but that’s not going to factor into the alimony award except to the extent that maybe she was using marital money to carry on the affair, in which case you could get that money back. But that’s basically it. The only time fault factors in is if something really egregious happens, but it has to be like really extreme.
For example, there is a case with one of the heiresses to the Johnson and Johnson fortune where her husband tried to have her killed and when the husband then went on to divorce her, he demanded spousal support and the court said, ‘no, I’m sorry, that’s a bit too much even for New Jersey, if you try to have your wife killed, you don’t get to have alimony on top of that.’
But I can also show you a case where a divorced woman went to prison for beating her son. And when she got out of it, she was allowed to apply for alimony based on her new needs as a convict. So even that kind of conduct didn’t remove the alimony obligation. So the bottom line is unless your spouse tries to kill you, basically his or her behavior is not going to be a bar to alimony.
All right, so how does alimony work in New Jersey? Well, let’s go through the basics. First, understand that there are actually five kinds of alimony and they have similarities, but they also have important differences and it’s important to understand the differences in order to understand their different functions. The first one we’re going to talk about is called P L or pendente lite alimony, and that’s just an unnecessarily complicated way of saying alimony that’s going to be paid while the divorce is pending. Pendente lite meaning pending litigation.
In other words, between the point that someone has filed the complaint for divorce and the point that there is a final judgment of divorce, it’s likely that several months will pass. Sometimes things can go for over a year and sometimes substantially more than that. A P L or pendente lite award of alimony is just really to cover that period of time. It’s only designed to be temporary and it’s much in the discretion of the court. It’s usually not measured with the kind of precision that a final award of alimony would be. And it can change from time to time as circumstances change and it can be credited against any final alimony award. So basically what the courts try to do here is figure out how to put a bandaid on this situation and just make sure that the spouse that’s in the weaker financial position is able to maintain the marital lifestyle as best he or she can while we sort out the rest of this divorce.
And maybe the courts give too much because the courts tend to err on the side of caution, but P L awards are always subject to reallocation anyway. In other words, if you are paying too much in support, you can get a credit for that when the divorce is being finalized and you get a more accurate picture of what your alimony obligation should be. On the other hand, if you’re receiving alimony, you still want to get as much as you can upfront because it establishes something of a precedent and you want to keep that in mind. So that’s what a PL or pendente lite alimony award is. It’s just temporary and subject to adjustment and correction later on and when you actually finalize the divorce.
Now the four other kinds of alimony are all specific to the final judgment of divorce.
In other words, these are all kinds of alimony that get assigned once you get divorced. And the first and the one that every payor is most afraid of is permanent alimony, although it’s not really called that anymore in New Jersey. It’s really called open durational alimony and this is reserved for marriages lasting over 20 years. It doesn’t have an official end date. That’s why it’s called open durational. That doesn’t mean it can’t end or won’t ever end. It just means you keep paying until the court says you don’t have to do it anymore. And that could be for a long time and we’ll get to that in a bit. Just to understand for now that open durational alimony is not really for short or intermediate term marriages. That is you know those under 20 years. But, and there’s always a but in these situations, it can be sometimes for a marriage that is shorter than 20 years.
There is an exception that says you can get open durational alimony where you can demonstrate exceptional circumstances. In fact, one of the themes you’re going to find in family court, in New Jersey and in spousal support in particular is that everything is open to judicial discretion. So when it comes to awarding permanent alimony or not for marriage is shorter than 20 years. Judges look at the extent to which one party is dependent on another, whether the other spouse had to give up a career or other career opportunities, whether they supported the career of this, of the payor spouse, things like that. There are certain enumerated factors and then on top of that there’s always this catchall with these things that says the judge can consider anything else in his mind that he considers to be equitable, which just means whatever the judge seems to think is fair at that moment.
If you saw my video on prenups, you might remember that family court is a court of equity, not a court of law, so judges have broad discretion to do whatever they think is fair. Anyway, the basic idea of open durational slash permanent alimony is it’s really for longer term marriages of 20 years or more, but you can get it for shorter marriages under exceptional circumstances and I would add that even within that group, the longer the marriage, the greater the odds that there’s going to be at an award of permanent alimony.
Now that’s, that is in contrast to the third kind of alimony, which is called limited duration alimony or sometimes term alimony. This is alimony. That’s just for a specific period of time. It’s for marriages that are fewer than 20 years and the rule is that unless you have exceptional circumstances, the length of the alimony obligation can’t exceed the length of the marriage.
And in fact the better rule of thumb from my experience anyway, is it tends to be about half the length of the marriage or somewhere in that neighborhood, not usually less, but somewhere around that. So an eight year marriage cannot have an alimony term greater than eight years under limited duration alimony and in all likelihood you’re looking at something closer to four to five years.
But again, there are a lot of variables. The other two kinds of alimony tend to be for very short term marriages. One is rehabilitative alimony where you’re really just looking to get the other side back on his or her feet and on with life so you’re not kicking them to the curb for example. And you get this a lot. You have one of these like three year marriages or something with two people who got married who never should have and now they want to get divorced.
Well, you don’t want to throw the lesser earner out on the street, but you really can’t keep the bigger earner on the hook for that long. So the goal is to get the recipient spouse to a reasonable place where she’s back on her feet and then everyone moves on. So in that example, maybe you’d see an alimony term of a year to a year and a half or something like that and it probably wouldn’t be that great of an amount, but that’s just the basic idea of rehabilitative alimony. Just get the person back on his or her feet and on with their life and then the two of them can live separate divorced lives from each other.
The last kind of alimony, and this is very rare because it usually gets wrapped up into something else, it’s called reimbursement alimony. Again, you generally see this in brief marriages where you had one spouse who contributed a lot to the other spouse in terms of advancing that person’s career or something like that, like getting a professional degree or license.
So that person wants to get paid back for that. Well, normally you can get that out of the general marital funds, but sometimes there’s not enough money to do that. So for example, person a pays $50,000 for person B to go to law school, which by the way would be a bargain and after three years they divorce but they don’t own any homes, they don’t have anything in the bank. Well, it’s only fair that person aid gets paid back, but there’s no money to do so. So you create a reimbursement alimony where it just gets paid over time. But again, that’s not very common.
All right, but let’s talk about what everyone wants to know about how much you’re going to pay or get paid under the two major kinds of alimony. Open durational and limited durational. And I’m going to tell you right now, clients tend to want certainty when it comes to alimony, but it’s not an exact science.
There is no magic calculator for this. This is not like child support, which has its own subject where you have computer software and you give me your income and the other side’s income and certain deductions get factored in. And you type all of that information into the computer and you hit a button and turn the crank and it spits out a number and that’s your child support obligation. Alimony is nothing like that. It’s more about balancing a bunch of different factors together than it is about any one magic formula and it’s really determined on a case by case basis. And keep this in mind again, family court is a court of equity, which means judges have a lot of discretion to impose what they subjectively think is fair and that leaves a lot of uncertainty and gray areas. So estimating an alimony amount is not something that can be done with a great deal of precision, at least without having a complete view of everyone’s financial position and many other factors.
All right, now I’m not going to go over each of the factors here, but the main ones are the duration of the marriage, the needs of the parties, the age of the parties, their earning capacities, educational levels, skills, you know, basic employability. And also do they have outside income amounts. So if one party isn’t making any money by virtue of employment, but maybe they have a large inheritance that’s going to factor in. The inheritance itself is not subject to equitable distribution. But if Person A has a large stockpile of money and doesn’t really even need spousal support, it makes a lot less sense for Person B to pay a lot, if anything, even if he’s earning more.
Now, there used to be a one-third rule, which you can still find in a lot of poorly written articles floating around the internet. And the way it worked is you would take the higher earning spouse, subtract from that person’s income, the gross income of the lesser earning spouse and take a third of the difference. And that would be the alimony award. So if Spouse A’s making 90,000 and Spouse B was making 30,000 that’s a difference of $60,000 and the alimony obligation would be $20,000 from A to B because that’s one third of 60.
But that changed when the tax laws changed. It used to be the alimony payments were tax deductible if you were paying it and it was taxable if you were receiving it. Now it’s the opposite. Now when you pay, you don’t get to deduct that from your taxes so you’re getting hit twice and when that all changed we had to do away with the one third rule, which again wasn’t really a rule and you weren’t really supposed to use it but everyone was using it but it can’t be used anymore anyway. You really now have to go through the various factors because they’re a lot more sensitive than it used to be.
Now, I want to mention briefly that alimony can be modified or terminated under some circumstances, and I should probably do a whole video just on this one topic because it’s one of these things that’s an inch wide and a mile deep, but for now understand that the general rule is that the amount of alimony can be modified based on either changed circumstances or the non-occurrence of circumstances that the parties or the court thought was going to occur when the alimony award was made, but pay attention. That’s just the amount to be paid, the duration. In other words, the amount of time you’re going to be paying alimony can only be modified under unusual circumstances so you can modify the amount under changed circumstances, but the duration only under unusual circumstances and we can get into what all that means in a different video.
Now, if the other side gets remarried, you can generally terminate alimony, but even that, believe it or not isn’t quite 100% guaranteed depending on the kind of alimony and there were a few other things that go into it. If the other side isn’t remarried but is seeing someone well, then you get into a whole discussion about the extent to which the new boyfriend or girlfriend is contributing financially and whether they’re cohabiting and that’s a whole mess for no a whole other video. The point is that the two most common and expensive kinds of alimony in a final judgment of divorce are open or limited duration alimony and they can be modified upon a showing of changed circumstances and shortened upon a showing of unusual circumstances. You wouldn’t really see this with rehabilitative or reimbursement alimony because both of those are short term and have very specific purposes that have to be fulfilled, but I suppose you could theoretically try to modify those as well. If you want to spend a fortune on an attorney for what would probably be very little gain, if any.
Anyway, that’s a brief overview of alimony law in New Jersey for people who are facing divorce or going through the process. Again, I’ll do terminating or modifying alimony in a separate video. In the meantime, if you have any questions and would like to set up a consultation, please give me a call and I’ll be happy to set up a meeting with you. Thanks for watching.