According to the new law, the court will weigh these factors to determine whether maintenance is appropriate. However, if maintenance is appropriate, the court is now instructed to use specific formulas to determine both the amount and the duration of the award in most cases. In certain cases, courts are permitted to deviate from the statutory formulas, in which case the divorce court will use the statutory factors to determine the amount and duration of the maintenance award.
In this article, we will provide an in-depth explanation of the factors courts consider in determining whether maintenance is necessary and the amount and duration of alimony payments when the statutory formula is not applied. We will also discuss when the spousal maintenance formula is to be applied and explain the calculations used in the formula.
Factors Courts Consider in Determining Whether Maintenance Is Appropriate
- The income and property of each party;
- The needs of each party;
- The present and future earning capacity of each party;
- The "Homemaker Contribution";
- Any impairment of the present or future earning capacity of the party against whom maintenance is sought;
- The time necessary for the party seeking maintenance to obtain the appropriate education, training, and employment;
- The standard of living during the marriage;
- The duration of the marriage;
- The age and physical and emotional condition of both spouses;
- All sources of public and private income, including disability and retirement income;
- Tax consequences of the property division;
- Contributions of one spouse to the other's education or career;
- Agreements between the parties;
- Any other factor that the court finds to be just and equitable.
If Alimony is Appropriate, when Will Courts Apply the Statutory Formula, as Opposed to Weighing The Factors, To Determine Amount and Duration of Maintenance?
You should be aware that divorce courts are not required to follow the statutory guidelines for amount and duration of the maintenance award in every case in which the combined gross income is less than $250,000.00. However, if the judge chooses not to follow the statutory guidelines in these cases, the order in which maintenance awarded must lay out the amount and duration that the guidelines would call for and the judge's specific reason for departing for the guidelines.
How is the Amount of Spousal Maintenance Calculated Under Illinois' Statutory Guidelines?
If the judge chooses to award maintenance, the statutory guidelines call for the following formula to be applied to determine the amount of spousal maintenance to be paid each year:
(30% of the gross income of the spouse who will pay maintenance) - (20% of the gross income of the spouse who will receive maintenance) = The amount of spousal maintenance to be paid each year.
Capping the Maintenance Award at 40% of Combined Gross Income
There is one caveat to this formula. The statutory guidelines do not permit the spouse receiving maintenance to be awarded more than 40% of the couple's combined gross income. The judge will perform a second calculation to ensure that this doesn't happen. The judge will add the amount of the yearly maintenance award derived from the first calculation to the gross income of the spouse receiving maintenance. If this number equals more than 40% of the couple's combined gross income, the judge will reduce the maintenance award.
Determining Gross Income
So what is included in each spouse's "gross income" for the purposes of calculating the amount of the maintenance award?
The Income Withholding for Support Act defines "income" as any form of periodic payment to the party in question, regardless of source, including but not limited to:
- Wages, salary, commission, and bonuses;
- Compensation as an Independent Contractor;
- Worker's compensation benefits;
- Disability benefits;
- Annuity payments;
- Pension and retirement benefits;
- Insurance proceeds;
- Vacation pay;
- Profit-sharing payments;
- Severance pay;
- Monetary gifts;
- Social security benefits;
- Proceeds from the sale of real estate; and
- Portions of retirement account distributions consisting of interest or appreciation earnings.
- Public assistance payments;
- Unemployment insurance benefits;
- Loans; and
- Portions of retirement account distributions consisting only of contributions.
Calculating the Duration of the Maintenance Award
For marriages longer than 20 years, the judge has discretion to order either permanent maintenance or maintenance for a number of years equaling the duration of the marriage.
For marriages that lasted 20 years or less, the judge multiplies the number of years of the marriage by a specific percentage to determine the number of years that the maintenance payments will continue:
- For marriages lasting 0-5 years, maintenance will be paid for a duration equaling 20% of the duration of the marriage;
- For marriages of 5-10 years, the maintenance duration will be 40% of the duration of the marriage;
- For marriages of 10-15 years, the maintenance duration will be 60% of the duration of the marriage;
- For marriages of 15-20 years, the maintenance duration will be 80% of the duration of the marriage.
The Factors Courts Consider in Determining Maintenance Explained
The Income and Property of Each Party
The first step is to determine what constitutes "gross income" according to these statutes, as discussed above. The next step is to deduct certain expenses in order to calculate the "net income" of each party.
Once gross income is determined, the following expenses will be deducted to calculate "net income":
- Union dues;
- Federal and state income tax;
- Social security payments (FICA);
- Mandatory retirement contributions required by law or as a condition of employment;
- Insurance premiums for life insurance ordered by the court to secure payment of child support;
- Prior obligations of support or maintenance actually paid pursuant to court order;
- Foster care payments received;
- Expenditures for repayment of business debt;
- Medical expenditures; and
- Expenditures for the benefit of the child or other parent, not including gifts.
The Needs of Each Party
The court will examine each party's needs with equal emphasis, including the party from whom maintenance is sought. The goal of the needs analysis is determine whether one party needs maintenance, and, if so, whether the other party has the ability to pay. The court has broad discretion in determining what needs are reasonable. Even if the spouse seeking maintenance is employed, the court may award maintenance if it is deemed necessary to continue the standard of living enjoyed during the marriage. However, if the couple lived frugally during the marriage, this fact alone will not serve as an argument to reduce the maintenance award.
The bottom line is that the needs analysis for maintenance is determined on a case-by-case basis by the trial court, depending on the specific facts of each case.
The Present And Future Earning Capacity Of Each Party
If one spouse is unable to be "financially independent" courts are likely to award maintenance. "Financial independence" means that the spouse is able to continue the same standard of living that he or she enjoyed during the marriage. This goes beyond simply the ability to pay minimum expenses.
Permanent maintenance is often awarded when one spouse is not employable or will only be employable in the future at a wage that will be too low to meet his or her previous standard of living.
However, the spouse seeking maintenance has a duty to seek appropriate employment. Courts will not allow a spouse seeking maintenance to simply live off of the maintenance award if the individual is employable.
Reduction in earning Capacity and Time Needed to Train
Courts will review the spouse's entire employment history to determine whether any breaks in employment affected the spouse's rate of pay or seniority. Courts will consider the spouse's career expectations at the time of the marriage, and how the domestic duties of the marriage may have impaired those expectations. The attorney for the spouse seeking maintenance will try to establish how the spouse's position today would be different had he or she not made sacrifices for the marriage.
Another factor that courts will consider is the time needed to obtain training or education, and whether employment or education may be inappropriate due to custody of children. If a spouse can be appropriately self-sufficient after education or training for a specific time frame, then rehabilitative maintenance for that time frame may be awarded.
Finally, depending on the circumstances, custody of a child may excuse a spouse from the affirmative duty to seek employment or training. In this case the spouse seeking maintenance must show that the cost of day care, or the spouse's employment hours make it impossible or impractical to arrange for the children's care during work.
The standard of Living During the Marriage
Even if it is not possible for both spouses to enjoy the same standard of living they enjoyed during the marriage, the court will attempt to close any gap between the two spouses' standards of living as much as possible. On the flip side of this coin, even if the spouse seeking maintenance could meet his or her expenses and still have a disposable income without maintenance, Courts may nonetheless award maintenance if doing so would be necessary to approximate the spouse's pre-divorce lifestyle, even if that lifestyle was lavish.
Courts will not always provide for a spouse's standard of living permanently, and may award temporary maintenance if appropriate based on the other factors that courts must consider.
Finally, child support payments should not affect maintenance, as the child support is intended for the child while the maintenance is intended for the spouse.
The Duration of The Marriage
The spouse from whom maintenance is sought may argue that he or she should not pay maintenance for a duration longer than the marriage. However, even for a short marriage, courts may find that other factors outweigh the duration of the marriage. For example, in In re Marriage of Stam, 260 Ill.App.3d 754 (3d Dist. 1994), the court awarded maintenance for a period longer than the spouses' five-year marriage, because the spouse seeking maintenance had multiple sclerosis and it was unlikely she could ever become self-supporting. In In re Marriage of Hasabnis, 322 Ill.App.3d 582 (1st Dist. 2001), the court found that a one-year marriage had a significantly negative impact on the wife's career, and that this factor outweighed the short duration of the marriage.
The rule of thumb is that the longer the marriage, the greater the maintenance award, depending of course on the other factors involved.
The Age and Physical and Mental Health of Each Party
For example, when a party seeking maintenance suffers from a permanent mental or physical disability, this may reduce earning capacity and weigh in favor of a permanent maintenance award in order to allow that spouse to maintain the standard of living that he or she enjoyed during the marriage. Poor health tends to result in a larger maintenance award.
In In re Marriage of Grunsten, 304 Ill.App.3d 12, 709 N.E.2d 597 (1st Dist. 1999), the court found that the wife's return to the modeling industry in which she had previously employed would negatively impact her self-esteem. Since the wife had been diagnosed with clinical depression, the court awarded maintenance in order to not require her to return to that industry.
The physical condition of the parties may also carry more weight with the court than the duration of the marriage. When a spouse suffers from a permanent disability, permanent maintenance may be awarded even if the marriage was short in time.
When the spouse from whom maintenance is sought has potentially reduced income from a physical or mental condition or because that spouse is nearing retirement age, the maintenance award may be reduced despite a previously high earning capacity.
The court may reserve ruling and set a future hearing date in the case of a potentially short-term physical disability, in order to determine whether the disability will ultimately allow the spouse seeking maintenance to return to work. Finally, the court will not be bound by an administrative agency like the Social Security Administration's determination of a spouse's medical condition, but may make its own determination.
Tax Consequences of Property Division
In determining how property is divided, courts will consider the tax consequences of such division, such as penalties for early withdrawal from IRAs and other retirement accounts. If an early withdrawal from an IRA can be made from an IRA to provide for the education of the spouse seeking maintenance, then the maintenance award for education or training of the spouse seeking maintenance may be taken care of through property division rather than maintenance, and the maintenance award would be less than it would have been had the IRA funds not been available for this purpose without penalty.
Maintenance payments are tax deductible to the spouse making the payments if the following requirements are met:
- The payments are in cash;
- The payment must be made pursuant to a judgement for dissolution or other court order;
- The court order or judgment must designate the payment to be a maintenance obligation, as opposed to property division or child support;
- The payor and the recipient must not live in the same household;
- The obligation to pay must terminate upon the death of the spouse receiving the payment.
Contributions To Education & Career Of The Other Spouse
Valid Agreements Between The Parties
- One spouse's previous decision to give up permanent maintenance from a previous husband to marry the spouse from whom maintenance was sought; and
- The spouse seeking maintenance living with a partner during the dissolution action.
- marital misconduct or immorality;
- cigarette-smoking; and
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