Florida Divorce – Alimony
May 26, 2022
In a Florida Divorce proceeding, one’s entitlement to alimony is based on his/ her “need” and the other spouse’s “ability” to contribute to the support of the spouse in need. In order to determine a spouse’s need for alimony, Florida Divorce law requires that we consider income or earning potential of both spouses. “Income” comes from a variety of sources, most notably, one’s wages/ salary as well as overtime, bonuses, commissions and allowances. If someone is voluntarily taking early withdrawals from a retirement account such as a 401k or IRA, same may not be considered as income to that party. However, “interest earned” on an investment account may be considered income. Mandatory or minimum withdrawals are properly treated as income for purposes of calculating alimony in a Florida Divorce proceeding.
By way of example, Spouse “A” has reasonable and necessary expenses of $4,000.00 per month. Let’s further assume “A” earns monthly minimum wages of $1,733.00/ month (before tax) in Florida. In the Florida Divorce proceeding, “A” receives $500,000.00 in cash savings as part of an equitable distribution, which earns an estimated 3% per year, or $15,000.00 gross annually ($1,250.00/ month). This interest income is “imputed” to “A” as income for purposes of calculating alimony, which means that “A” has $2,983.00 in gross income per month, for an approximate $2,625.00/ month. Therefore, “A” needs $1,375.00 in alimony ($4,000.00 - $2,625.00). Assuming “A” is under the age of 59 ½ , then “A” would not be required to deplete his/ her retirement plan to meet his/ her monthly needs.