Michigan Divorce Education Series
Divorce in Michigan – Alimony and Spousal support: This video Webinar is a comprehensive explanation of Michigan law and strategy covering alimony / spousal support. Key learnings and strategies are discussed. I am hopeful you find it both empowering and educational. A summary of the topics covered is provided below. (run time – approx. 16 minutes)
What is Alimony / Spousal Support?
Alimony and spousal support are synonymous, and are period payments to support and maintain the former spouse.
How is Alimony Calculated?
Michigan law provides subjective factors for courts to use.
- parties’ past relations and conduct;
- The length of the marriage;
- parties’ ability to work;
- source and amount of property awarded to the parties;
- parties’ ages;
- Ability to pay spousal support;
- Parties present situation;
- Parties’ needs;
- Parties’ health;
- Prior standard of living of the parties;
- whether the parties support others;
- General principles of equity (fair)
The “real” factors include:
- Age
- Education
- Length of Marriage
- Income of the Parties
- Emotional Factors (subjective)
What about Alimony Support Guidelines?
Every Judge has “guidelines” for alimony / spousal support. Michigan law prohits the use of “a rigid and arbitrary formulas that fail to account for the parties’ unique circumstances”.
What are the Guidelines?
Two software companies:
- Springfield Publications Prognosticator
- Margin Soft (Craig Ross)
Local guidelines:
- Judge Lombard’s Rule of 1/3
- Percentage of excess income
- Equalization of incomes in long term marriages
Guideline Factors
The Michigan Court of Appeals in the case of Myland vs. Myland stated that Michigan law prohibits the use of a rigid and arbitrary formula that fails to account for the parties unique circumstances.
Notwithstanding the Myland case, most courts, mediators and attorneys use guidelines in evaluating a spousal support claim. There are two leading guideline computer programs. One by Springfield publications prognosticater, and another by MarginSoft, written by former Washtenaw County referee, Craig Ross. Some Judges have there own guidelines in determining alimony. These formulas vary.
Key factors to consider while negotiating alimony:
- IRC 71 and IRC 215;
- Modifiable and non-modifiable support;
- Present value calculations;
- Discounting and pre-payments;
- Trading assets or debts in lieu of support
It is important to note, that the fault of a party or basis for the breakdown of the marriage, is a relevant factor in awarding alimony/spousal support notwithstanding the notion that Michigan is a no-fault divorce State.
Modifiable vs. Non-Modifiable
A Michigan divorce court can only order modifiable alimony. However, parties can agree on a non-modifiable award pursuant to the Michigan Court of Appeals case of Staple v. Staple. Caution should always be considered when evaluating a non-modifiable award. For example, if you lose you job, you are still obligated to pay. On the other hand, if your health fails or your income falls, you may be stuck with inadequate support.
Tax Considerations
Most alimony or spousal support payments are tax deductible to the person paying and tax deductible to the person receiving support. This is governed by Internal Revenue Codes section 71 and section 215. For a more detailed explanation on the this issue, The IRS has generated a topic on the subject. visit: http://www.irs.gov/taxtopics/tc452.html
Negotiation strategies
There are many creative ways to both, maximize or minimize a parties’ alimony or support award or obligation including tax effecting assets, discounting, buy-outs of an obligation, trading assets or debts in exchange for more or less alimony/spousal support and proper application of the alimony/spousal support factors.
Your attorney should be competent in creative solutions to maximize his or her client’s entitlement or exposure. Many attorneys run “Guidelines” to estimate a client’s exposure or obligation for support. While “Guidelines” are appropriate in analyzing child support, Alimony/Spousal support is much more complex.
A confidential consultation is the best mechanism to privately discuss your options.
We want to help. Call 877-YOUR FIRM
Daniel
Articles on Michigan Alimony and Michigan Spousal Support by the Divorce Guy.
- Alimony and tax considerations: https://www.thedivorceguy.com/alimony-and-tax-considerations/
- Veterans benefits: https://www.thedivorceguy.com/the-veterans-benefit-myth-va-benefits-and-divorce/
Michigan Cases and Statutes on Alimony and Spousal Support
Michigan Compiled Laws (MCL)
Michigan Court Rule (MCR)
Michigan Court of Appeals (Mich App)
Statutory authority for spousal support in Michigan
MCL 552.23(1): The court may award spousal support as is just and reasonable if the property award is insufficient for the suitable support of either party.
MCR 3.211(B)(4): If spousal support is not granted, the judgment must either reserve the question or state that neither party is entitled to spousal support. If the Judgment is silent, the is is reserved for possible later consideration.
Parish v. Parish 138 Mich App 546 (1984), Factors to be considered in awarding alimony or spousal support.
Uniform Support Order: SCAO forms FOC 10b and FOC 10c. Any provisions regarding spousal support (alimony) must be prepared on a Uniform Support Order. The Uniform Support Order governs if the terms of the judgment or order are in conflict.
Uniform Interstate Family Support Act. This act permits enforcement of an income withholding order by filing it with the State.
Interstate Income Withholding act. Only the FOC can request income withholding from another jurisdiction.
Past relations and conduct of the parties:
Sparks v Sparks, 440 Mich 141 (1992) The Court must make findings on each spousal support factor. The conduct of a party during the marriage may be relevant in an award of spousal support or alimony. Fault is only one factor and should not be assigned disproportionate weight.
Hanaway v. Hanawy, 208 Mich App 278 (1995), The trial court is in the best position to determine the extent to which each party’s conduct contributed to the breakdown in the marriage in evaluating alimony and spousal support claims in Michigan.
Johnson v Johnson, 346 Mich App 418 (1956), The length of the marriage is a relevant factor in evaluating alimony and spousal support claims in Michigan.
Ability to work:
Sullivan v Sullivan, 175 Mich App 508 (1989), A temporary award of alimony or spousal support in Michigan is not fair when there is serious doubt about a party’s ability to support herself after an award of temporary support.
Goal is to balance incomes:
Magee v Magee, 218 Mich App 158 (1996), The objective of an award of spousal support or alimony in Michigan is to balance the incomes and needs of the parties in a way that will not impoverish either party.
Pension benefits maybe distributed through a Michigan divorce property division or spousal support:
Demman v. Demman 195, Mich App 109 (1992), Age is a factor in determining spousal support or alimony awards in a Michigan divorce.
Un exercised ability to earn income:
Knowles v Knowles, 185 Mich app 497 (1990), The ability to pay spousal support includes the un-exercised ability to earn income if income.
Health of the parties:
Lesko v Lesko, 184 Mich App 395 (1990) Health is relevant to the ability to work and to the person needs of a spouse seeking spousal support or alimony in Michigan.
Modification of Michigan alimony or spousal support
Crouse v Crouse, 140 Mich App 234 (1985) Spousal support is modifiable upon showing of a change in circumstances. Moving party must show by a preponderance of the evidence.
Staple v Staple, 241 Mich App 562 (2000), parties can waive the statutory right to modify spousal support.
MCL 552.28 creates the statutory right to modify spousal support.
Remarriage
Ackerman v Ackerman 163 Mich Ap 796 (1987) Remarriage in and of itself is insufficient to terminate spousal support, however it is pertinent.
Cohabitation
Crouse v Crouse 140 Mich App 234 (1985) Cohabitation with an unrelated person does not constitute a de facto marriage and justify the termination of Michigan alimony or spousal support.
Change in need
Aussie v Aussie, 182 Mich App 454 (1990): Changes in need including the loss of a home, legal expenses, and unforeseen costs are sufficient factors to extend the period of Michigan alimony or spousal support.
Change in ability to pay
Boyer v Boyer, 30 Mich App 623 (1971) Ability to pay is relevant to a determination if Michigan alimony or Michigan spousal support should be increased or decreased.
We are here to help you navigate this journey by focusing on your goals. If you have any questions concerning any aspect of the law, let me know. My direct line is 248-399-3300 or toll free: 877-968-7347.
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By: Daniel Findling
The Divorce Guy, Michigan Divorce Attorneys and Specialists
877-YOUR FIRM