What is a lump-sum payment alimony payment?

A lump sum is a large, fixed payment comprising all of the alimony, for example, lump-sum alimony, which is a fixed payment from one ex-spouse to the other. Lump sum alimony is often given instead of a property settlement when there is little property to divide.

Lump-sum alimony is unusual in that it is payable even if certain events occur that would normally cause the cessation of alimony, such as remarriage. Since lump-sum alimony is in lieu of a property settlement or is reimbursement alimony, the present or future status of the recipient does not affect the alimony. Lump sum can even be made payable to the estate of the recipient, should he or she die, if the alimony agreement so states.

Lump-sum alimony is the only maintenance payment that cannot be modified. Once a lump sum has been agreed upon, the recipient cannot change it, no matter what the circumstances. For this reason it is imperative to have good legal advice about any lump-sum alimony.

Let’s say a divorcing couple decide on a lump-sum settlement instead of periodic support payments. A spouse who declares bankruptcy can discharge it. A bankruptcy court may not consider it to be in the nature of support, so a lump-sum settlement may be discharged by bankruptcy.