5 Essential Things to Know About New Jersey Alimony

5 Essential Things to Know About New Jersey Alimony
Many New Jersey divorce cases involve alimony issues in which the requesting parties think they are entitled to receive it while the others hotly contest their estranged spouses' requests. Alimony is a type of support that may be ordered by the court in a divorce case. Divorcing spouses might also come to an agreement through which one spouse agrees to pay the other spouse alimony of a specific amount and for a specific duration.

Alimony was originally created by the legislature to protect women who had put their careers on hold to stay home and support their husbands while raising their children and ensure they would not be left destitute in a divorce. These payments were expected to be paid by the husband to his ex-wife until the wife either became financially independent or remarried.

Today, women enjoy greater gender equality with most women choosing to remain in the workforce during marriage and many earning just as much or more as their spouses. As a result, the alimony system in New Jersey has also changed since alimony was originally conceptualized and codified in the Garden State. If you have questions about alimony and whether it might be an issue in your divorce, you should consult an experienced divorce lawyer in New Jersey at the Ziegler Law Group. To provide you with a general overview of the alimony laws in New Jersey, this article explores five essential facts about alimony that you should know when you're preparing to end your marriage.

1. Either Spouse Can Be Ordered to Pay Alimony to the Other Spouse

The first thing you should understand is that courts can order either spouse to pay alimony to the other one. Alimony orders are not gender-specific, and wives can be ordered to make alimony payments to their former husbands just like husbands can be ordered to make payments to their former wives. Courts consider 14 specific factors outlined in the state's alimony law when deciding whether to award alimony in divorce cases. While there are multiple factors courts are to consider, gender is not included as one of the factors.

Courts consider the financial circumstances of the requesting spouse and whether they need alimony to make ends meet or obtain education to become self-sufficient for a set time or over a long duration. Courts also consider whether the other spouse has the financial ability to make alimony payments. If a wife earns substantially more than her husband and has done so throughout the marriage, she might be ordered to pay alimony to the husband just the same as if the roles were reversed. Similarly, a same-sex spouse can be ordered to pay alimony to the lower-earning spouse in a divorce. The key is that the gender of the would-be payor and the requester are unimportant and will not be taken into account by the court.

2. Open Duration Alimony Is Generally Not Awarded

The New Jersey Legislature reformed the state's alimony system in 2014 and make numerous changes to the law. A major change the legislature made was ending the permanent alimony system. Instead, the length of alimony typically will not last for longer than how long the marriage lasted. For example, if the marriage lasted for less than 20 years, the maximum amount of time that alimony might last will also be 20 years if the marriage lasted longer than 20 years to fully be considered open duration. 

Before issuing an alimony order for longer than a marriage, the court must find that exceptional circumstances exist to support the award. Some of the factors courts consider to determine whether exceptional circumstances exist include the following:
  • The ages of both spouses at the time they married and the time they get divorced
  • How financially dependent one spouse has been and continues to be on the other spouse
  • Whether one spouse is suffering from a chronic medical condition and is unable to work
  • Whether a spouse will receive a significantly larger share of the marital property
  • Whether one spouse was prevented from becoming self-supporting because of the marriage
  • Potential tax consequences of an alimony award
  • Other relevant factors

The reforms the Legislature made to the alimony laws were not retroactive, meaning they did not apply to alimony that was awarded before the new law's effective date. This means that if your divorce occurred before 2014, you might still have to continue paying permanent alimony or might continue to receive payments.

3. Modifications Can Be Made to Alimony Orders

Alimony orders can last for years. As time goes by from when an alimony order was issued, life can happen and change the financial circumstances of either or both parties. Events such as unexpected job losses, serious illnesses, serious injuries, or retirement can occur after alimony has been ordered. If your financial circumstances have substantially changed since alimony was awarded in your case, you can file a petition with the court to modify the original alimony order to reflect the changes in your financial circumstances.

The payor spouse's substantial drop in income is among the most common reasons why an alimony modification might be sought. If you are self-employed, you will be required to present evidence to the court demonstrating that the reduction in your income was involuntary. An employed spouse who suffers a sudden reduction in income can request a corresponding reduction in alimony 90 days after the reduction occurs.

When a spouse files a modification request with the court based on a drop in income, the court will consider the following factors:
  • Reason why the income drop occurred
  • Any efforts the payor spouse has made to find a new job
  • Whether the payor spouse has made good-faith efforts to find a new position paying as much or more than the former position
  • Income earned by the payor spouse
  • The recipient spouse's income and financial circumstances

If the court finds that the financial circumstances have substantially changed since the original award was issued, the alimony orders can be modified.

4. Alimony Can Be Terminated or Suspended When the Recipient Begins Cohabiting With a New Partner

Most people know that alimony will terminate or be suspended when the recipient remarries. However, most people don't realize that alimony can also be terminated when the receiving spouse starts living in cohabitation with a new partner. Some spouses who receive alimony mistakenly believe that they can live with a new romantic partner as if they are married and continue to receive alimony as long as they don't get married, but this is not the case.

If you are paying alimony, and your former spouse moves in with a new romantic partner, you might be able to ask the court to end alimony even if your former spouse doesn't live with the new partner full-time. Cohabitation is defined as being involved in an intimate, mutually-supportive relationship.

To determine whether your former spouse's relationship qualifies as cohabitation, the court will consider the following factors:
  • Whether they are living together
  • Whether the couple shares their living expenses
  • Whether the finances of the couple are intermingled
  • Whether the couple shares chores
  • How long the couple's relationship has lasted
  • Whether the couple's relationship is recognized by their friends and family members
  • Whether your former spouse's new partner has promised to provide support to them
  • Other evidence

5. There Might Be Tax Implications to Alimony

Before the passage of the Tax Cuts and Jobs Act in 2019, spouses paying alimony could deduct the payments on their federal income tax returns. This provided somewhat of an incentive for a higher-earning spouse to agree to pay alimony in a property settlement agreement. However, the ability to deduct alimony ended with that law, meaning that any alimony orders issued or agreed to after 2018 no longer allow payor spouses to deduct their payments on federal income tax returns.

Despite federal law, you can still deduct alimony payments on your state income tax return if you are ordered to pay them. Recipient spouses must also report alimony payments they receive as income on their state returns.

Talk to a Divorce Lawyer in New Jersey

If you have questions about alimony in your divorce or need a modification, you should speak with a divorce lawyer in New Jersey at the Ziegler Law Group. We can help you understand whether alimony might be an issue in your case and work to negotiate an agreement with your estranged spouse. Call us today at (973) 878-4373.

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