In Wisconsin, alimony is officially referred to as spousal maintenance or just maintenance. Courts have quite a bit of discretion in deciding whether maintenance should be awarded, how much to award, and for how long.
Here are some essential things to know.
- Types of Spousal Maintenance in Wisconsin
- Factors That Determine Spousal Maintenance Amounts
- Modifying a Support Order
- Does Child Support Affect Spousal Support?
- Does Asset Division Affect Spousal Support?
- Options When Non-Payment is an Issue
- Spousal Maintenance and Taxes
Types of Spousal Maintenance in Wisconsin
Spousal maintenance in Wisconsin is gender-neutral and can be awarded on a limited term or for an indefinite amount of time as part of the divorce process.
Limited-term support is sometimes referred to as rehabilitative support and is applied in cases where one spouse has the potential to become self-supporting eventually.
The limited term gives the spouse time and financial support to go back to school or learn skills necessary to find a job that provides financial independence. This type of support is common when one spouse has left the workforce to raise a family, and now needs time to become current and marketable to employers.
A court decides the date when the maintenance ends, but if needed, the court may review the order to evaluate whether an extension is appropriate.
Indefinite spousal maintenance is common in long-term marriages where a spouse’s absence from the workforce, health issues, or advanced age makes it challenging to become financially independent.
In cases where a spouse needs help to make ends meet while a divorce is in progress, a judge can award temporary support. That ends when the judge finalizes the divorce. Spousal support payments are not in effect until a judge finalizes the divorce and issues a support order.
Maintenance ends in all cases if either spouse dies or if the recipient of maintenance remarries.
Factors That Determine Spousal Maintenance Amounts
In some cases, spouses are free to work out spousal maintenance agreements on their own, but when they can’t agree, courts will step in a make the determination instead.
Courts look at several factors to determine whether support payments should be awarded, how long, and what amount.
There is no definitive formula in Wisconsin on how these decisions are reached. Before making an award regarding maintenance payments, a requesting spouse must demonstrate a need for support and that the other spouse has the ability to pay. Courts have a lot of discretion but Wisconsin laws provide several factors the court must consider:
- the length of the marriage
- the age and physical and mental health of both spouses
- the educational level of each spouse at the time of marriage and at the time of the divorce
- the supported spouse’s earning capacity, including educational background, training, employment skills, work experience, length of absence from the job market, custodial responsibilities for children, and the time and expense necessary to acquire education and training to find employment
- the feasibility that the supported spouse can become self-supporting and obtain a standard of living comparable to that of the marital standard of living
- tax consequences to each spouse
- retirement accounts
- assets and liabilities of each spouse
- any mutual agreements between the spouses before or during the marriage
- whether either spouse contributed to the other’s education, training, or increased earning power,
- any other factor the court determines is relevant to the case.
Before creating a family support award, judges must follow the law for each and determine the two obligations separately. The court will also consider child support awards at the same time as deciding spousal maintenance if a couple has minor children. The two may be combined in these cases, and the court may order “family support” instead.
Although it is a common misconception, judges will not consider marital misconduct when determining spousal maintenance issues.
In cases where substance abuse is present, it may or may not affect maintenance awards, depending on the circumstances and the severity of the impact. In some cases, addiction is acknowledged as a disease, and assistance should be awarded to help in recovery. In other cases, courts have ruled that a spouse should not be required to provide support to a former spouse who cannot hold down a job due to addiction.
Read More: Everything You Need to Know About Alimony
Modifying a Support Order
Unless specifically noted, either spouse can request a review or modification of a maintenance order. The requesting spouse must first prove there is a substantial change of circumstances that makes the existing order unfair or inappropriate.
For example, a paying spouse may be stricken by a long-term illness, an involuntary job loss, or similar significant life changes.
Until a hearing occurs, the paying spouse must continue to pay the existing support amount order until the judge says otherwise. Failure to comply can result in several negative consequences.
When a paying spouse retires, this may also trigger a review. If the paying spouse retires and has no other source of income except their retirement benefits, and those were divided during the divorce, chances are that maintenance would be terminated. Courts will also look at why a spouse retired, whether they have other sources of income, whether they can still afford to pay maintenance after retirement, Maintenance can be terminated if the receiving spouse dies, remarries, or begins living in a marriage-like relationship.
Finally, if the paying spouse dies, maintenance will also be terminated.
Does Child Support Affect Spousal Support?
Although spousal maintenance and child support are calculated separately, they impact each other.
Wisconsin uses pre-determined child support guidelines to set the amount of child support payments. The amounts are based on the Percentage of Income Standard, which considers the parent’s income, how much time a child spends with each parent, and if the parent is supporting other children.
Wisconsin courts can award a different child support amount at the judge’s discretion. Judges use factors such as special or unusual needs of a child, significant contributions from a parent, disparity in income between the parents, the medical and educational needs of the child, and many other factors in the decision-making process:
Read More: The Ultimate Guide to Child Support
Does Asset Division Affect Spousal Support?
Wisconsin is a community property state, meaning all marital assets are divided 50/50 in a divorce. This can create flexibility when determining spousal maintenance awards. For example, one spouse may agree to give up additional marital assets (such as a house, etc.) in exchange for less or no spousal support.
However, before property settlement can occur, it must be classified as marital or separate. Separate property can include inheritances left to one spouse, any real or personal property acquired before the marriage, certain kinds of passive income, any property acquired after legal separation, any property excluded by a pre-or post-nuptial agreement, and any gifts that are proven to be given to only one spouse.
Some asset values are easy to determine, such as bank accounts or stocks and bonds. All pensions, IRAs, 401Ks, and retirement plans are treated as marital property in Wisconsin but can be difficult to value accurately, often requiring the assistance of an outside expert to place an accurate valuation.
Options When Non-Payment is an Issue
In most cases, maintenance orders require paying spouses to pay periodically, usually every month. A court may decide to order a paying spouse to pay in lump-sum payments or by property transfer to a spouse in certain circumstances.
If the paying spouse does not pay on time, the recipient spouse can return to the court and request assistance in the form of a contempt motion.
If a spouse is found in default of any alimony payment, a judge can:
- Order that any outstanding orders or judgments be paid.
- Order that securities be sold to make the payments.
- Enter a contempt of court order
- Order wage garnishment
After a contempt motion is filed, the judge will conduct a hearing where spouses can state their positions. If the judge finds that a spouse intentionally failed to pay the alimony order, it can order a spouse to be sent to jail until the past due amount is paid. The judge can also order that the uncooperative spouse pay fines and legal fees.
A wage garnishment is an order that the court sends to the employer of the non-paying spouse. It authorizes the employer to pay a part of the employee’s paycheck to the court, and the court then makes the alimony payment to the other spouse.
Spousal Maintenance and Taxes
Until January 1, 2019, paying spouses could deduct maintenance payments from their income at the end of the tax year, and the recipient spouse reported and paid taxes on the income.
However, the 2017 Tax Cuts and Jobs Act eliminated the tax-deduction benefit and reporting requirements for maintenance agreements and orders finalized after January 1, 2019.
If you’re unsure how the tax changes or your current situation impacts your bottom line, you should speak with an experienced family law attorney or tax professional.