Changes to Oklahoma alimony support are on the horizon.
Under the recently passed Tax Cuts and Jobs Act signed into law by President Donald Trump, alimony (also known at spousal support) will no longer be deductible by the payor and count as income by the recipient. The provisions will not affect divorce decrees and separation agreements entered before Dec. 31, 2018, but those signed after would be impacted.
The Oklahoma alimony support lawyers of Fry & Elder are well aware that ending the 76-year old deduction could drastically impact many divorce settlement negotiations and agreements and are taking a proactive approach in preparing for the imminent changes set to come to Oklahoma alimony support.
“The change in tax treatment will have obvious effects on settlement agreements, as the tax deduction is often an important consideration when crafting a settlement agreement that includes support alimony,” local attorney Amy Page said in an email directed to Fry & Elder attorneys. “We are aware of these effects and are and will continue to be prepared to educate our clients about them as well.”
Oklahoma Alimony Support Defined
Alimony in Oklahoma and most other states is financial support paid by one spouse to another after divorce. Oklahoma alimony terms can be agreed upon by the parties involved or a judge can decide. Spousal support payments typically come in monthly installments but also can be paid in one large lump sum.
Unlike child support, there is no set formula to determine spousal support in Oklahoma. There also is no set time frame on how long a spouse can expect to pay or receive alimony. When determining the amount of spousal support to be paid, the following components often apply:
- The length of the marriage
- The health and age of each spouse
- The mode of living to which each spouse has become accustomed during the marriage
- Evidence of a spouse’s own income-producing capacity and the time necessary to make the transition for self-support
- Demonstrated need during the post-matrimonial economic readjustment period
- The parties’ station in life
- The earning ability and education of each spouse
- The parties’ physical condition and financial means
The Potential Impact of the Tax Provisions to Oklahoma Alimony Support
As Fry & Elder’s teams of attorneys alluded to, changes to the tax treatment of spousal support could be far reaching, particularly at the negotiation table where the ability to use alimony deduction was often a powerful bargaining chip.
With only one year remaining for alimony to be claimed as a deduction, it has been reported that some family law attorneys are advising couples considering divorce to file this year – before the deduction is eliminated.
The reasoning behind Vidas’ recommendation may stem from the fact that with alimony being wiped out as a deduction, more disputes could emerge between the two parties and what they deem as a fair number for spousal support.
“The deduction substantially reduces the cost of alimony payments – for people in the highest income-tax bracket, it means every dollar they spend to support a former spouse really costs them a little more than 60 cents.”
Added Pittsburgh family law attorney Brian Vertz:
“The repeal reduces the bargaining power of vulnerable spouses, mostly women, in achieving financial stability after a divorce.”
Though alimony was historically awarded to the wife, this is not the case anymore. Gender is now irrelevant when determining Oklahoma alimony support, meaning either the husband or wife can receive alimony.
Why Experience the Fry & Elder Difference?
Robert G “Hap” Fry Jr.’s divorce philosophy to “always seek mediation and resolution first, but when a compromise can’t be made to shoot all the bullets you have and throw the empty gun at them” has long been a hallmark of the firm. That said, Fry & Elder has remained proactive in staying up to date with Oklahoma family law practices, including spousal support.
The firm has been named to the U.S. News & World Report’s Best Law Firms List every year since 2014 and Is comprised of an experienced team of family law attorneys which include:
- Two 2018 Best Lawyers® Selections
- One of only 19 attorneys in the state to be a Fellow of the American Academy of Matrimonial Lawyers
- Best Lawyers® Lawyer of the Year for Family Law in Oklahoma 2016
- The 2016 Oklahoma Family Law Attorney of the Yearby the Oklahoma Bar Association Family Law Section
- Five attorneys recognized by Super Lawyers®
- Four attorneys AV® Preeminent Peer Review Rated by Martindale-Hubbell®
- Three of the past five Oklahoma Bar Association Family Law Section Chairs
- A Cherokee Nation District Court Judge
- The 2017 OBA Earl Sneed Award Recipients
Should you have any additional questions in regards to Oklahoma alimony support or any other family law matter, we encourage you to contact Fry & Elder Tulsa today to set up a personal consultation with a proven family law attorney.