What Is Alimony In Gross And How Will It Affect You
Alimony in gross is a different sort of alimony that is treated more like a property settlement than traditional alimony payments. Whereas traditional alimony has the express purpose of helping one party in the divorce maintain a similar lifestyle as during the marriage either for a rehabilitative period or permanently and is subject to changes in the event of remarriage, new income or new expenses, alimony in gross is a set dollar amount, either payable in a lump sum or in installments. Because alimony is such a touchy subject, alimony in gross is often used to make divorce proceedings easier. It is commonly used for parties seeking a cordial relationship after the separation. Because while it is less subject to a variety of complicated clauses and caveats, it is also more difficult to enforce.
Differences Between Alimony In Gross And Standard Alimony
There are several important differences between these two types of alimony payment. These include:
- Modifiability - Standard alimony payments are modifiable depending upon changes in either party's life. It is treated as support in the eyes of the law. Alimony in gross is treated as a debt in the eyes of the law, much like property. Debts don't change or go away just because life circumstances change.
- Tax Deductions - Alimony in gross is not tax deductible for the payer, whereas standard alimony is treated as financial support, similar to child support or a head-of-household deduction. Similarly, it is not treated as income for the purposes of tax payment by the recipient of the alimony in gross payment. Standard alimony is tax deductible for the payer and taxable for the recipient.
- Enforcement - Standard alimony is paid through Family Court offices in your state, municipality or county. This makes it easy to obtain a record of payments and to request assistance from the courts to enforce these payments. However, periodic alimony in gross payments are made directly between the payer and the recipient. Enforcement depends on an Order to Show Cause, which is a more complicated legal issue.
Consult with a divorce lawyer to determine whether alimony in gross makes sense for you.