Duration of Spousal Support With Settlements
How long will spousal support last? Letís look at the different ways in which spousal support may be negotiated in settlement in order to get a sense of where your case falls in the spectrum.
Spousal support wonít be offered following a very short marriage with each spouse still self-sufficient. One to two years of support might be negotiated to meet specific needs of the recipient after a short marriage of three to four years.
Variations abound, of course. Support may be paid for six months to close a deal, and have nothing to do with need. Support for one or two years has been used as a disguised property settlement, allowing the payor to deduct the "support" payments while the recipient pays little or no tax.
A marriage of four to five years may possibly require support lasting as long as the marriage itself. Assume the recipient is the custodial parent of pre-school children. Spousal support until the children are in school might be negotiated based upon a moral obligation. The existence of pre-school children will influence but, alone, wonít cause a court to make this order. A marriage of the same length may result in little or no spousal support if the spouses remain self-sufficient.
The amount of support doesnít have to remain constant. A stepdown to a lesser amount might be arranged to occur after two years, following a short to medium length marriage of three to six years. However, the recipient should have a specific plan for returning to self-sufficiency before agreeing to future decreases in the amount of spousal support. A court wonít order a future stepdown based on speculation or wishful thinking.
A final stepdown to zero dollars, with a reservation of jurisdiction, is negotiated in some settlements. Again, the recipient must have a workable plan before agreeing to future decreases in support. The retention of jurisdiction to award spousal support in the future, is a safety net, however, giving the court power to order further spousal support if something goes awry.
Of far greater impact is the termination of spousal support, or spousal support cut off, absolutely ending spousal support on a fixed date. Termination of support is often a bargaining chip. Payors of spousal support want a cut-off to limit their exposure; recipients may choose to sell the cut-off for the right price in the form of a lump sum, increased payments until the cut-off or additional property. If the marriage was lengthy, payors often feel that negotiating is the only way that there will ever be an end to support. Recipients take all the risk, and should do so only after much discussion and reflection. A recipient ending a judicially defined lengthy marriage would be foolhardy to agree to a relatively arbitrary cut-off for any figure likely to be offered.
Remove any doubts that you may have during the negotiations as to whether you are talking about support being terminated, cut off or stopped. There are two aspects to the ending of spousal support: first, the obligation to pay support may terminate, that is, the payorís obligation to make current payments ceases; and second, the courtís jurisdiction to order support may terminate, ousting the court of the power to make any support order for any reason, no matter how great the need. It is possible the first may occur, but because the court still has power to order support, the recipient gets a new order for more support from the payor whose obligation to pay under the old order ceased. The payor would certainly feel duped if negotiations had been unclear.
Never-ending jurisdiction to award support is the reality. It follows that the trend is toward never-ending support when needed following lengthy marriages. The court is predisposed to extend support unless the agreement clearly and expressly prohibits it.
There is yet another form of the surprise continuation of support. Although the courtís power to order support terminates on a fixed date, the power of the court which exists until the termination date creates a loophole recipients have exploited to obtain a new support order from the court going years past the "termination" date. Thatíll really upset a payor who negotiated for an absolute cut-off! If you negotiate any support termination or cut off, the settlement agreement should resolve all ambiguities and give examples. This cannot be spelled out in too much detail and too emphatically.
Large stepdowns in spousal support trigger devilish tax consequences. The spouse paying support must have tax advice if reductions in support will be dramatic, such as fifteen thousand dollars or more, from one year to the next. The federal tax plan designed to discourage property settlements from being disguised as deductible support payments uses a large step-down as the index. A nightmare results in which the one paying spousal support must now pay taxes on support paid in prior years, and the recipient gets a refund of taxes paid on prior support.