5 Common Errors Made in Alimony Cases
- The standard of living established during the marriage;
- The duration of the marriage;
- The age and the physical and emotional condition of each party;
- The financial resources of each party, including the non-marital and the marital assets and liabilities distributed to each;
- The earning capacities, educational levels, vocational skills, and employability of the parties and, when applicable, the time necessary for either party to acquire sufficient education or training to enable such party to find appropriate employment;
- The contribution of each party to the marriage, including but not limited to, services rendered in homemaking, child care, education, and career building of the other party;
- The responsibilities each party will have with regard to any minor children they have in common;
- The tax treatment and consequences to both parties of any alimony award, including the designation of all or a portion of the payment as a nontaxable, nondeductible payment;
- All sources of income available to either party, including income available to either party through investments of any asset held by that party; and
- Any other factor necessary to do equity and justice between the parties.
While the factors seem straightforward, mistakes still occur. Below is a list of five common mistakes that occur in alimony cases.
1. Using Gross income instead of Net Income
Trial courts and attorneys often erroneously rely upon gross income rather than net income to calculate alimony. Appellate courts have repeatedly held that alimony should be based on the net income of the payor. This was upheld by Kingsbury v. Kingsbury, 116 So. 3d 473 (Fla. 1st DCA 2013) and Topel v. Topel, 152 So. 3d 863, (Fla. 5th DCA 2014)(holding that the ability to pay alimony should be based on the party’s net income.)
2. Failure to properly calculate income
Section 61.046(8), Florida Statutes, defines “income” to include “retirement benefits, pensions, dividends, [and] interest.” This includes income from investment accounts, dividend payments, and payments from pension plans. If a retirement account is distributed to a party and produces income without invading the principal, then it must be considered for the purpose of calculating alimony. Niederman v. Niederman, 60 So. 3d 544, 547-48 (Fla. 4th DCA 2011); see also Winnier v. Winnier, 163 So. 3d 1279, 1280 (Fla. 2d DCA 2015). This is true regardless of whether the party has attained the age at which funds may be withdrawn without penalty. Niederman, 60 So. 3d at 548. The interest or other income earned on any account within the party’s possession, including accounts transferred as part of equitable distribution, fall within the statutory definition of income and should be considered in calculating alimony. See Adelberg v. Adelberg, 142 So. 3d 895, 899 (Fla. 4th DCA 2014).
3. Failing to Impute Income to the payee
A court may impute income if a party is earning less than he or she could, based on a showing that he or she has the capability of earning more by the use of his or her best efforts. The concept of imputing income is to require those who are able to work to do so.
To impute income for purposes of determining alimony, a trial court must find that the unemployment is voluntary. A court may also impute income when a spouse or former spouse is voluntarily underemployed, which means the spouse is voluntarily earning less to avoid working or to avoid making alimony payments. However, when a spouse ceases full-time employment to seek enhancement of his or her education, the courts may look to see if the spouse is acting in the best interest of the support recipient when determining whether to impute income.
If the court determines that it is appropriate to impute income, the level of income imputed must be based on recent work history, occupational qualifications, and prevailing earnings level in the community. It is error for a trial court to base the amount of imputed income solely on the past earnings of the parent or spouse without consideration of the other factors.
4. Alimony award exceeds the stated need
The amount of alimony awarded to a spouse, when coupled with the amount of income imputed to that spouse, cannot exceed the spouse’s stated need. If a court awards more alimony than the party requested without sufficient findings in the final judgment to support the increased award, the award must be reversed. See Gray v. Gray, 103 So. 3d 962, 966 (Fla. 1st DCA 2012). In addition, even though there may be ample evidence that the parties enjoyed a high standard of living during the marriage, there still must be evidence of the stated need of the spouse requesting alimony after the marital home is sold and the divorce is finalized.
5. Alimony award not commensurate with standard of living established by parties during the marriage
The stated purpose of permanent alimony is to allow the requesting spouse to maintain the standard of living established by the parties during the marriage and to ensure that, viewing the totality of the circumstances, one spouse is not shortchanged. Zinovoy v. Zinovoy, 50 So. 3d 763, 766 (Fla. 2d DCA 2010) (quoting Griffin v. Griffin, 906 So. 2d 386, 388 (Fla. 2d DCA 2005)). This requires the trial court to ensure that each party’s standard of living after the marriage comes as close as possible to the lifestyle of the parties during the marriage, given the available financial resources. Griffin, 906 So. 2d at 389; see also Laz v. Laz, 727 So. 2d 966, 967 (Fla. 2d DCA 1998). The applicable standard of living is the most recent standard of living shared by the parties. Hill v. Hooten, 776 so. 2d 1004, 1007-1008 (Fla. 5th DCA 2001).