With the dissolution of marriage, the subject of alimony will inevitably come up. Once a marriage is over, the soon-to-be divorced couple will discuss with their attorneys and the courts how to split everything, from custody of the children to marital assets and the like. Alimony, however, is its own unique concept. Before you can even begin to discuss alimony in Oregon, you first need to understand exactly what alimony is.
What is alimony?
Alimony is the amount of support that a spouse pays to a dependent spouse after their marriage has ended. It is also referred to as spousal support. The dependent spouse is the one who made less money than the other spouse during the marriage. The money awarded by the court can begin to be paid out during the separation period while the divorce is pending, or it can begin as soon as the divorce is final. The rules of alimony vary by state, and Oregon has its own set of rules.
What types of alimony does Oregon have?
In Oregon, there is more than one type of alimony.
Transitional support is meant to be temporary. It’s intended to cover a limited period of time so the dependent spouse can either go back to school or learn a skill that can help them become self-supporting. Once the dependent spouse is able to support themselves, the transitional support will end. The end date will be at the discretion of the court.
Compensatory support is the kind of support issued by a court when a major expense happened during a marriage that gave one spouse significantly more earning power than the other spouse. An example of this could be when one spouse received a law degree or medical degree while the other spouse supported them. This helps prevent those cases where a spouse would leave the marriage as soon as they got their advanced degree, leaving the other spouse destitute.
This is the type of support that will allow the dependent spouse to continue living in the same lifestyle they were living in before the divorce.
How is alimony calculated?
Unlike other states, there’s no set formula or calculator to determine support amounts in Oregon. In some states like New York, there’s a calculator that is used to help determine alimony and child support amounts. If a supporting spouse earns “X” amount of money, that amount would be run through the calculator to determine how much money the supporting spouse would have to pay.
Oregon doesn’t have that type of calculator for spousal support, although one does exist for child support. When it comes to determining spousal support, the court will take an overview of a family’s financial situation. It will look at the amount of money that was needed to support the lifestyle they had before the divorce, and it will take into account how much money will be needed to support that lifestyle after the divorce for each party.
Other factors that the court will take into account include each spouse’s future earning potential, how long they were married, and the age and health of both spouses. Oregon sets up spousal support determinations in a way that will allow both spouses to continue living in the manner they had become accustomed to while they were married.
Is alimony in Oregon taxed?
Spousal support is no longer treated as income.
Prior to 2019, when a dependent spouse received alimony payments, they were to treat that money as income. That meant that the alimony they received was to be taxed as income. The supporting spouse making the payments was able to deduct the amount they were paying for alimony on their taxes.
As of 2019, that is no longer the case. Supporting spouses can no longer deduct alimony amounts from their taxes, and dependent spouses no longer have to pay taxes on the support they receive. This is a nationwide change that came about as a result of the Tax Cuts and Jobs Act.
How long does alimony last?
Alimony is not intended to last forever.
Depending on the circumstances of the divorce, spousal support can last anywhere from a year to 20 years or more. It completely depends on each couple’s individual situation. There are two ways the length of time that alimony lasts can be determined.
First, the couple could have a friendly, amicable divorce, and they could mutually decide on a set amount of time that alimony will continue. If that’s the case, that is what will happen.
On the other hand, if the two sides are unable or unwilling to negotiate with one another, the court will determine how long alimony will be paid. When making that determination, Oregon courts take into account the age of the spouses, how long the marriage lasted, and other factors specific to the individual cases. If there’s a situation where a spouse has become unable to work due to a disability or illness, support could continue indefinitely.
Can alimony be changed?
Alimony can be modified as time goes on.
A couple’s circumstances at the time of a divorce will determine the spousal support outcome. There are instances, however, where that amount may be increased or decreased depending on updated circumstances.
If the supporting spouse experiences a drastic change in income that reduces the amount they are able to comfortably pay, that spouse may appeal to the court to have the award amount reduced. Conversely, if the dependent spouse experiences a drastic reduction in income that reduces their quality of life, the court may take that into consideration as well and raise the alimony amount.
If a change in status happens where the dependent spouse remarries, the court will usually terminate alimony payments. It will, however, take into account the dependent spouse’s new marriage to determine if the new marriage upgrades the dependent spouse’s living situation. After that determination, alimony payments will either be halted, continued, or reduced. At the end of the day, it’s up to the discretion of the court.
If you are going through a divorce, speak to a lawyer or legal specialist regarding alimony in Oregon. As you can see, the court has a lot of discretion regarding the ultimate outcome, and all outcomes are based on the individual circumstances of the divorcing couple. Arming yourself with knowledge before you start can help ensure an equitable and fair outcome for everyone.