Alimony affected taxes in the past. Alimony has been a deduction from income when the payor files his/her income tax return. If the payor earned $100,000 in a year and paid $1,000 a month in alimony, his/her taxable income would be $88,000. The $12,000 per year alimony would be added to the recipient's income and he/she would pay taxes on the alimony received.
We are all familiar with the concept of a "Prenup". That is the agreement that parties enter into before marriage, making a full and complete disclosure of all financial information and making provisions for future alimony and equitable distribution of assets in the event that of a divorce. Many people feel that it is not romantic to ask a future spouse to sign an agreement before marriage about how to divide assets upon a future divorce, but it can clarify how people feel about money and how to divide their assets if the marriage fails. Many people getting into a second marriage feel that it is important to protect their children and allow them to keep their assets acquired before the new marriage.A Postnup is entered into after the parties marry. Every marriage is different and there is no one answer for all situations. One good time to negotiate and create a Postnup is when a child is to be born. It should set out how long either or both parents may be out of the workforce. If the parties agree that one parent (often but not always the Mom) will leave his or her job for an extended period of time, what happens in a divorce? Suppose the parties agree that one person will stay home for a year or longer.
Rhode Island residents who are divorcing are probably wondering how their split will affect their finances. Unfortunately, divorce had a negative impact on the financial situation of former "Nip/Tuck" star Dylan Walsh. His split is going to cost him approximately half of all of his assets, including money made from the show "Nip/Tuck." The divorce between Walsh and his actress ex-wife was finalized last week, and according to the divorce documents, Walsh has agreed to pay his ex-wife half of his royalties from the show along with royalties from a couple of his movies.
Many divorcees fall in love again, but Rhode Island residents who are looking to re-marry will want to review a few issues first to make sure that lingering issues from their first marriage will not impede on their second marriage.
Traditionally, alimony and child support were paid by men to women. Occasionally, clients tell me that the Court's are biased against men - that Courts award women custody, child and spousal support and that a man does not receive the same treatment.
Years ago, alimony or spousal support, was understood by most parties. When a marriage broke down due to the husband's fault and the wife had remained at home without a career, the wife needed life-long support. Today, there are very few long term marriages in which the wife does not work. The marriages of our parents or grandparents no longer exists.