When a person files a petition for the dissolution of their marriage, alimony can be awarded depending on the marital assets, marital settlement agreements, and the economic need of the couple. Typically, spousal support payments are meant to provide financial support and equalize the standards of living of the spouse after divorce. Often, the spouse with a higher earning pays alimony to the lower-earning or non-wage-earning spouse after a divorce, usually every month. But, sometimes, the paying spouse may not want their former spouse to get a chunk of their monthly paycheck. Unfortunately, failing to make a payment can put the receiving spouse in a bad financial position. Because of this, the law allows for alternative solutions to monthly alimony payments to provide flexibility and freedom for both parties.
If you are the paying spouse, your financial situation may change and make it difficult for you to pay support payments every month. Because of this, you must contact an attorney from Ramos Law Group, PLLC to help arrange an alternative payment option. The following are your alternative options:
Make a Lump-Sum Payment
Instead of making multiple support payments, you can make a single, lump-sum payment to your ex. You and your attorney should try to negotiate a slightly lower payment amount in exchange for paying all that you owe at once. However, there are downsides to this option. Tax issues and early withdrawal penalties from investments can be an issue. In general, it is best to speak with a financial advisor about the situation before you decide to choose this option.
Choose a Property Buy-Out
You and our ex may choose to waive spousal support and instead agree on an uneven division of community property. In this case, you would be obligated to support your ex and it would be from your share of the marital assets like home equity, cash, retirement benefits, or business. This spousal payment option involves buying up the property in one colossal sum instead of paying monthly support. This payment option allows you to save yourself from never-ending modifications of the terms and agreements that can happen if you are obliged to make monthly support payments. Also, a spousal support buyout is not taxable, making it an attractive option. This means that you don’t have to declare the transfer on your taxes and neither does your ex upon transfer of property. But, there are many pitfalls to this plan that must be discussed with your attorney and financial advisor before you choose this route.