California Spousal Support Can Be Tricky.
Also known as “alimony”, even many lawyers don’t quite understand it. It’s covered in California Family Code 4320. Here’s a little bit of a primer.
Temporary Spousal Support
You have to differentiate whether we are talking about permanent spousal support or temporary (aka as interim or pendente lite) spousal support. There’s a real difference in how we calculate it.
Temporary spousal support is typically set by a judge using a standard formula. Different counties in the state use different formulas. In San Diego County, for example, we use what is called the “Santa Clara” formula.
Essentially, the judge inputs incomes, deductions, taxes, etc. into a computer and the software spits out a number. This number is meant as a bridge for the supported spouse and tends to be about 10-15% higher than what the permanent support ends up being.
Permanent Spousal Support
Permanent spousal support is a little bit harder because California Family Law prohibits the family court from relying solely on the software in determining the amount of support. The divorce court must look at the factors in California Family Code section 4320.
The California Family Code 4320 Spousal Support factors include:
- The parties’ needs based on the standard of living esablished during the marriage;
- The length of the marriage or domestic partnership;
- Each parties’ ability to earn;
- The age and health of each party;
- How a job might make it harder to care for kids;
- The parties’ debts;
- The parties property;
- Whether someone helped the other get an education or career;
- Any history of domestic violence between the parties;
- Whether a spouse had decreased career opportunities because of caring for the kids; and
- The effect of alimony on taxes.
The family court takes all of the factors in Family Code section 4320 into account and then makes an order. It’s sometimes hard to predict what the amount of the alimony payments will end up being. That’s why it is smart to try to work things out between the parties using a no-court option like mediation or collaborative divorce rather than going to court, because you never know exactly what a judge will do. Settling reduces the risks to each party.
Unlike child support where the payments are not deductible to the payor or taxable to the recipient, spousal support payments have a big tax impact. For orders prior to 2019, persons paying spousal support can exclude payments from their income for tax purposes. Payments from pre-2019 orders are taxable to the recipient.
Sometimes that works out well, because it may be better to tax the support recipient who may have a lower tax bracket. The deduction goes to the higher earner in the higher tax bracket.
There are very technical rules about the tax treatment of your alimony payments. So make sure you talk to your CPA and legal counsel.
NOTE: With recent federal tax changes, Congress eliminated the spousal support tax deduction. New alimony awards in divorce decrees entered after December 31, 2019, are treated exactly like child support. They will not be excluded from the payor’s income and are not taxable to the supported spouse. Talk to your CPA or attorney for more details about how new tax laws relates to your specific situation.
How Long Will Alimony Payments Last?
There are short marriages and long marriages. California considers 10 years or longer to be a long marriage. A short marriage is less than 10 years.
This is important because the family court will typically order support for a period of time of 1/2 the length of the marriage if it’s a short marriage. But in a long marriage, the court will not set an end date. This means the support obligation could conceivably last for life.
However, this is tempered by the public policy that the supported spouse make efforts to become self-supporting. If he or she doesn’t make efforts, the Court can stop or reduce the payments. Often, the Court will issue a special notice to the supported spouse called a Gavron Warning. Basically, the Court warns the supported spouse to make efforts to become self-supporting or face the possibility that support will end.
Spousal Support Modifiability
Unless the parties agree otherwise, the spousal support order is always modifiable. So, if ever there is a substantial change of the financial circumstances existing when support is ordered, the parties can go back to court and change things. Most of my clients choose to do this out of court using mediation, collaborative practice or consulting to come up with a new alimony order.
WARNING: A friendly handshake deal is not enough to relieve you of the duty to pay alimony. You need to have a written order (either by stipulation or from the family court) that a judge will sign before your payments change or stop. Otherwise, you are still liable even if the other person didn’t ask for you to make payments. Without the order changing the spousal support, you can be on the hook for spousal support arrears, penalties, interest and even contempt of court.
Lump Sum Spousal Support Payments
Sometimes parties might agree to forego monthly support payments in favor or a one-time lump sum payment. Typically, they will calculate a present value for the total support obligation. Lump sum payments can be helpful especially for couples that wish to reduce the amount of interaction after the divorce is final.
Talk to a Divorce Lawyer
Alimony can be tricky.
There are a lot of moving parts such as taxes, living expenses, marital standard of living and income that make this a tough issue. To get all of your questions answered before making any big decisions, you are wise to talk to an attorney like Shawn Weber, who is certified as a Specialist in Family Law by the California State Bar Board of Legal Specialization.