Facing divorce may get you thinking about all of the uncertainties that might follow. When you join your life with somebody else’s, you also join your goals, schedules and expenses. The last of these is why financial negotiations are often such a looming part of a separation. If your spouse was the higher earner, your financial security after divorce is a particularly important factor that should be taken into consideration.
In Arizona, spousal maintenance can provide such security. This term — which is typically interchangeable with alimony — refers to the allowance you may be granted in a divorce in order to maintain your standard of living. Here are three things you should know about it.
It may be temporary or permanent
The courts may grant spousal maintenance as a temporary or permanent measure, though it is becoming less frequent for a person to receive permanent support. Typically, it is granted temporarily to support a spouse throughout a separation or immediately following the divorce to facilitate financial rehabilitation. In the latter circumstance, the expectation is that the spouse will seek employment, education or job training to replace the income.
Financial need must be established
According to the Arizona State Legislature, there are several reasons for the courts to grant a person spousal maintenance. Some of these include contribution to education opportunities, inability to gain sufficient employment due to age or lack of property that will reasonably provide for needs. To receive spousal maintenance, the ex-spouse must prove these or other criteria.
Spousal maintenance is taxed
Many people are not aware that their income from spousal maintenance is subject to taxation. In Arizona, it is generally the recipient who will pay these taxes. The tax hit can be mitigated, however, if both the provider and recipient of spousal maintenance negotiate to structure the payments effectively. Not distributing them as lump sums, for example, can help you avoid property distribution tax.