Marital support and alimony are payments made between spouses during a divorce or separation. Spousal support is made during proceedings, while alimony is paid after finalization. Calculation is based on income differences, and alimony is tax-deductible, while spousal support is tax-free.
Marital support and alimony refers to the transfer of money, funds, and other assets between spouses during a divorce or separation action. These terms, while similar, apply to transfers of funds made at different stages of a divorce or separation proceeding. When two individuals separate after filing for divorce, spousal support payments are usually made to ensure that one spouse can continue to maintain their lifestyle or to care for minor children in whom she retains custody. Alimony is the term given to amounts that must be paid on a monthly or recurring basis after divorce proceedings have been finalized by a court.
Another common term for spousal support used in some jurisdictions is alimony payments. Support payments are typically made to a spouse with or less income so that she can maintain a current standard of living until divorce proceedings are final. On this basis, both alimony and spousal maintenance payments are made; however, alimony is typically not issued during an informal separation. Most jurisdictions require two spouses to be legally separated under the separation rules in the jurisdiction before spousal support is granted. In other jurisdictions, divorce proceedings must have previously been initiated before a court orders support payments of any kind between spouses.
Calculation of alimony and spousal support is often based on the difference between the income each spouse receives. In many jurisdictions, the party claiming alimony and spousal support will be entitled to a percentage of the difference between their income and the opposing spouse’s income. The percentage that is used as the basis for calculating alimony and spousal support is determined by the jurisdiction in which the parties reside. This percentage may take into account a few factors, such as the higher-earning spouse’s tax bracket, the number of children involved in the action, and the award of additional assets such as homes, vehicles, and other assets.
Another common difference between alimony and spousal support involves issues of taxation and deductible payments. Typically, alimony payments, or those due to be paid after divorce proceedings are final, can be deducted by the individual making the payment. The spouse receiving the payment will usually be required to report the payment amount as her tax income. Spousal support is generally considered tax-free income for the receiving spouse, especially in cases where the spousal support amount contains a child care or support allowance.
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