Stephens’ Squibs Guide to Alimony Reform 2017

The Florida Legislation is attempting “Alimony Reform” for the third time.  On Wednesday, January 18, 2017, Representative Burton filed HB 203 and on Friday, January 20, 2017, Senator Passidomo filed SB 412.

Governor Rick Scott vetoed similar efforts in 2014 and 2016, in part, because the bills contained a presumption or premise for equal timesharing,  a hotly contested item that has nothing to do with alimony.

So for… this year’s legislation has NO MENTION of timesharing… yet.

Of course politics is politics, and this is subject to change.  Stephens’ Squibs will be keeping a close eye on these bills and will report any news as it develops.  The last day of the Florida Legislature Session is May 5, 2017.  It will probably be a bumpy ride.  Check back often to www.EddieStephens.com/alimony-reform for updates!

Details:

SB 412 filed by Senator Kathleen Passidomo.  Full text if senate bill.

HB 203 filed by Representative Colleen Burton.  Full text of House bill.

Alimony Guidelines:

Initial written findings:

The first step is to determine:

(a) The amount of each party’s monthly gross income, including, but not limited to, the actual or potential income, and also including actual or potential income from nonmarital or marital property distributed to each party.

(b) The years of marriage as determined from the date of marriage through the date of the filing of the action for dissolution of marriage.

Presumptive alimony amount range:

The low end of the presumptive alimony amount range shall be calculated by using the following formula:

(0.015 x the years of marriage) x the difference between the monthly gross incomes of the parties.

The high end of the presumptive alimony amount range shall be calculated by using the following formula:

(0.020 x the years of marriage) x the difference between the monthly gross incomes of the parties.

For purposes of calculating the presumptive alimony amount range, 20 years of marriage shall be used in calculating the low end and high end for marriages of 20 years or more. In calculating the difference between the parties’ monthly gross income, the income of the party seeking alimony shall be subtracted from the income of the other party. If the application of the formulas to establish a guideline range results in a negative number, the presumptive alimony amount shall be $0. If a court establishes the duration of the alimony award at 50 percent or less of the length of the marriage, the court shall use the actual years of the marriage, up to a maximum of 25 years, to calculate the high end of the presumptive alimony amount range.

Presumptive alimony duration range:

Low end:  0.25 x the years of marriage

High end: 0.75 x the years of marriage

Alimony Award:

For marriages of 2 years or less, there is a rebuttable presumption that alimony may not be awarded. The court may award alimony for a marriage with a duration of 2 years or less only if the court makes written findings that there is clear and convincing need for alimony, that there is an ability to pay alimony, and that the failure to award alimony would be inequitable.

Fourteen statutory factors for Court to consider:

In determining presumptive amount, duration or deviations, the Court must consider:

1. The financial resources of the recipient spouse, including the actual or potential income from nonmarital or marital property or any other source and the ability of the recipient spouse to meet his or her reasonable needs independently.

2. The financial resources of the payor spouse, including the actual or potential income from nonmarital or marital property or any other source and the ability of the payor spouse to meet his or her reasonable needs while paying alimony.

3. The standard of living of the parties during the 266 marriage with consideration that there will be two households to maintain after the dissolution of the marriage and that neither party may be able to maintain the same standard of living after the dissolution of the marriage.

4. The equitable distribution of marital property, including whether an unequal distribution of marital property was made to reduce or alleviate the need for alimony.

5. Both parties’ income, employment, and employability, obtainable through reasonable diligence and additional training or education, if necessary, and any necessary reduction in employment due to the needs of an unemancipated child of the marriage or the circumstances of the parties.

6. Whether a party could become better able to support himself or herself and reduce the need for ongoing alimony by pursuing additional educational or vocational training along with all of the details of such educational or vocational plan, including, but not limited to, the length of time required and the anticipated costs of such educational or vocational plan.

7. Whether one party has historically earned higher or lower income than the income reflected at the time of trial and the duration and consistency of income from overtime or secondary employment.

8. Whether either party has foregone or postponed economic, educational, or employment opportunities during the course of the marriage.

9. Whether either party has caused the unreasonable depletion or dissipation of marital assets.

10. The amount of temporary alimony and the number of months that temporary alimony was paid to the recipient spouse.

11. The age, health, and physical and mental condition of the parties, including consideration of significant health care needs or uninsured or unreimbursed health care expenses.

12. Significant economic or noneconomic contributions to the marriage or to the economic, educational, or occupational advancement of a party; including, but not limited to, services rendered in homemaking, child care, education, and career building of the other party; payment by one spouse of the other spouse’s separate debts; or enhancement of the other spouse’s personal or real property.

13. The tax consequences of the alimony award.

14. Any other factor necessary to do equity and justice 307 between the parties.

Deviation from presumptive amount:

The court may establish an award of alimony that is outside the presumptive alimony amount or alimony duration ranges only if the court considers all of the fourteen statutory factors and makes specific written findings concerning the relevant factors that justify that the application of the presumptive alimony amount or alimony duration ranges, as applicable, is inappropriate or inequitable.

Imputation of income:

Introduces new concept of “potential income” defined as income that could be earned by a party using his or her best efforts and includes potential income from employment and potential income from the investment of assets or use of property. Potential income from employment is the income a party could reasonably expect to earn by working at a locally available, full-time job commensurate with his or her education, training, and experience. Potential income from the investment of assets or use of property is the income a party could reasonably expect to earn from the investment of his or her assets or the use of his or her property in a financially prudent manner.

New definition for underemployed and exception if obligor is enrolled in educational program that can be reasonably expected to result in degree/certification within a reasonable period of time and will result in higher income in foreseeable future, based on previous experience, immediate employment available.

If a party is voluntarily unemployed or underemployed, alimony shall be calculated based on a determination of potential income unless the court makes specific written findings regarding the circumstances that make it inequitable to impute income.

Nominal Alimony:

The court may make an award of nominal alimony in the amount of $1 per year if, at the time of trial, a party who has traditionally provided the primary source of financial support to the family temporarily lacks the ability to pay support but is reasonably anticipated to have the ability to pay support in the future. The court may also award nominal alimony for an alimony recipient that is presently able to work but for whom a medical condition with a reasonable degree of medical certainty may inhibit or prevent his or her ability to work during the duration of the alimony period. The duration of the nominal alimony shall be established within the presumptive durational range based upon the length of the marriage subject to the fourteen alimony factors in paragraph. Before the expiration of the durational period, nominal alimony may be modified in accordance with s. 61.14 as to amount to a full alimony award using the alimony guidelines and factors in this section.

Creates new burden for supportive relationships:

Obligor has the burden of proof to establish, by a preponderance of the evidence, that a supportive relationship exists or has existed within the previous year before the date of the filing of the petition for modification or termination. The obligor is not required to prove cohabitation of the obligee and the third party.  Also requires modification to be retroactive to date of filing petition.

Removes requirement that you must reside with a person for there to be a supportive relationship.

Adds a new factor to finding supportive relationship:  Whether the obligor’s failure, in whole or in part, to comply with all court-ordered financial obligations to the obligee constituted a significant factor in the establishment of the supportive relationship.

Limits discovery on obligor’s new spouse finances:

The financial information, including, but not limited to, information related to assets and income, of a subsequent spouse of a party paying or receiving alimony is inadmissible and may not be considered as a part of any modification action unless a party is claiming that his or her income has decreased since the marriage. If a party makes such a claim, the financial information of the subsequent spouse is discoverable and admissible only to the extent necessary to establish whether the party claiming that his or her income has decreased is diverting income or assets to the subsequent spouse that might otherwise be available for the payment of alimony.

Retirement:  Codifies Pimm v. Pimm:

A substantial change in circumstance is deemed to exist if the obligor has reached the age for eligibility to receive full social security retirement benefits or obligor has reached the customary retirement age 586 for his or her occupation and has retired from that occupation

Other Provisions:

When making a judgment or order for alimony, the court may, in its discretion after weighing the equities and tax efficiencies, order that alimony be nondeductible from income by the payor and non-includable in the income of the payee.

A combined award of alimony and child support may not exceed 55 percent of the payor’s net income, calculated without any consideration of alimony or child support obligations. If the combined award exceeds the maximum percentage of the payor’s net income, the court must adjust the award of child support to ensure that the 55-percent cap is not exceeded.

The court may order any party who is ordered to pay alimony to purchase or maintain a decreasing term life insurance policy or a bond, or to otherwise secure such alimony award with any other assets that may be suitable for that purpose, in an amount adequate to secure the alimony award. Any such security may be awarded only upon a showing of special circumstances. If the court finds special circumstances and awards such security, the court must make specific evidentiary findings regarding the availability, cost, and financial impact on the obligated party. Any security is modifiable if the underlying alimony award is modified and shall be reduced in an amount commensurate with any reduction in the alimony award.

Allows courts to modify the amount, but NOT the duration.

Specifies the remarriage of an alimony obligor does not constitute a substantial change in circumstance or a basis for a modification of alimony.

Requires 10% increase in recipient’s income to support a modification.  Payor’s increase in income is NOT a basis for modification unless at the time the alimony award was established it was determined that the obligor was underemployed or unemployed and the court did not impute income to that party at his or her maximum potential income.

If an alimony obligor becomes involuntarily underemployed or unemployed for a period of 6 months following the entry of the last order requiring the payment of alimony, the obligor is entitled to pursue an immediate modification of his or her existing alimony obligations and such circumstance shall constitute a substantial change in circumstance sufficient to support a modification of alimony.

Alimony guidelines do not apply to temporary awards (alimony pendente light).

Allows for temporary modification of alimony awards pending final hearing.

Provides prevailing party fees if a party unreasonably pursues modification.

Creates rebuttable presumption that modification of alimony is retroactive to date of filing unless inequitable.

If passed, this will apply to all initial determinations and modification actions brought on or after October 1, 2017.

Amendments to the law may not serve as a sole basis for modification.

Last updated January 22, 2017.

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