The law on Spousal Maintenance in Arizona was updated in August, 2018. Although the legislature did not make substantial changes to the statute, certain language was made more specific, particularly regarding the threshold question of whether one is entitled to receive spousal maintenance. This article will highlight different aspects of the spousal maintenance statute, making it easier to understand. It will also share why spousal support outcomes in Arizona are very difficult to predict.
Table of Contents
- 1 What is Spousal Maintenance?
- 2 How does Spousal Maintenance Work?
- 3 Entitlement To Spousal Maintenance
- 4 Understanding the Spousal Maintenance Entitlement Factors
- 5 Amount and Duration of Spousal Maintenance
- 6 Litigation Approach to Determining Amount and Duration of Spousal Maintenance
- 7 The Mediation Approach
- 8 Who is Entitled to Spousal Maintenance?
- 9 Types of Spousal Maintenance
- 10 Termination of Spousal Maintenance
- 11 Paying Spousal Maintenance
- 12 Are Spousal Maintenance Payments Taxable?
- 13 Modification of Spousal Maintenance
- 14 Spousal Maintenance Modified Due to Loss of Income
- 15 Are Prenuptial Agreements regarding Alimony Enforceable in Arizona?
- 16 Spousal Maintenance Enforcement
- 17 Conclusion
What is Spousal Maintenance?
Spousal maintenance, often times referred to as spousal support or alimony, refers to payment by one spouse to the other spouse following a divorce or legal separation. Arizona takes a needs-based approach to determining spousal maintenance. Spousal maintenance is designed to limit the negative financial impact of divorce, by providing financial support for a period of time to a spouse who cannot meet his or her reasonable expenses on their own. Payments are ordered only for as long as the receiving spouse needs them. The goals of any spousal maintenance award is to create a bridge to financial independence for both spouses as soon as possible, and to encourage financial independence by the party seeking maintenance.
It is important to note that spousal maintenance is not a substitute or supplement for child support payments. It is a wholly separate consideration, to be paid separately. For further information, please see our other articles regarding child support in Arizona.
How does Spousal Maintenance Work?
Not every divorce or legal separation involves spousal maintenance. Spousal maintenance may be agreed upon between the parties or ordered by the court. Parties may mutually agree on the amount and duration of spousal support in divorce mediation, or by settling a litigated case outside of court before a Judge renders an order.
A two-step inquiry is ultimately involved in spousal maintenance awards in Arizona:
1) Whether one spouse is entitled to spousal maintenance; the element of “entitlement.” In making this determination, the court considers only the circumstances of the requesting spouse. If a spouse satisfies at least one of the conditions of entitlement. The inquiry then shifts to the second step;
2) How much the spouse should receive and for what duration. If the court determines the spouse is entitled to an award, it then considers the relevant circumstances of both parties to determine whether to actually grant an award and, if so, the amount and duration. Although a spouse may be entitled to maintenance under step 1 of the inquiry, a court may nevertheless decide that an award of $0 is appropriate after consideration of the factors relevant to the second inquiry.
Entitlement To Spousal Maintenance
A spouse qualifies for an award of spousal maintenance after a divorce or legal separation if the spouse seeking spousal maintenance either:
- lacks sufficient property to provide for his/her reasonable needs;
- is unable to be self sufficient through appropriate employment, or is the custodian of a child whose age or condition prevents the spouse from working outside the home;
- has made significant financial or other contribution to the education, training, vocational skills, career or earning ability of the other spouse;*
- had a marriage of long duration and is of an age that may prevent the spouse from gaining employment adequate to be self-sufficient; or
- has significantly reduced that spouse’s income or career opportunities for the benefit of the other spouse.*
* 2018 Changes to Spousal Maintenance Law: Recently, the Arizona legislature revised the entitlement factors of spousal maintenance, altering Factor #3 and adding Factor #5. The new spousal maintenance revisions took effect in August 2018, and are discussed in more detail below.
What distinguishes mediation from litigation, with respect to spousal maintenance, is that in litigation, a Judge will determine whether an individual qualifies for spousal maintenance, while those in mediation mutually agree to any spousal maintenance award. Here, mediation provides a platform for spouses to develop their own agreements, as opposed to having a judge make the determination for them.
Understanding the Spousal Maintenance Entitlement Factors
Under Arizona Law, ARS 25-319, “the court may grant a maintenance order for either spouse for any of the following reasons if it finds that the spouse seeking maintenance:”
“The spouse seeking maintenance lacks sufficient property to provide for his/her reasonable needs.”
The law does not explicitly define what constitutes “sufficient property,” but the courts have provided some guidance. “Sufficient property” means property that, on its own, can provide for a spouse’s reasonable needs during his or her lifetime. Property allocated to one spouse, as part of the divorce decree, is considered when determining whether a spouse can provide for their needs with said property. In many cases, the property would actively produce income, either in its current form or by being converted into a suitable form so that it would provide a form of income.
In determining whether a person has sufficient property, the trial court may not consider the person’s earning potential in conjunction with his or her property. The trial court must evaluate the property element separately and determine whether the person’s property is “capable of independently providing for a spouse’s reasonable needs during his or her lifetime.”
For example, in one case the court contemplated that the Wife might need to convert non-income-producing property into income-producing property or sell it to provide for herself. The court modified its maintenance award by limiting it to two years in order to give Wife adequate time to convert her property into a form that would provide for her reasonable needs going forward.
“The spouse seeking maintenance is unable to be self sufficient through appropriate employment, OR is the custodian of a child whose age or condition prevents the spouse from working outside the home OR lacks earning ability in the labor market adequate to be self-sufficient.”
Determining whether a spouse is able to be self-sufficient through employment requires the Judge to consider additional factors, including the current labor market and the spouse’s existing skills and experience. Arizona courts give special consideration to older spouses who worked inside the home as homemakers, or stay-at-home-mom’s during long marriages, generally because the courts find that age and years out of the job market make it very difficult to find work that supports a lifestyle comparable to that enjoyed during marriage.
Additionally, a spouse who is the custodian of a very young child or a disabled child may not be required to seek immediate employment outside the home due to the needs of the child.
In litigation a Judge requires each spouse to complete an Affidavit of Financial Information to show their most accurate, reasonable expenses after divorce in order to assess whether spouses are each able to self-sufficient with their own individual income. This can lead to much conflict and fighting as spouses litigate over the “reasonableness” of one another’s expenses.
In mediation, each spouse completes a Monthly Budget Worksheet, instead of the Affidavit. Spouses do this individually, but then the mediator guides spouses through making adjustments in low conflict, cooperative way that avoids fighting and focuses on problem solving so that the outcome of agreements allows both spouses to be financially stable. Both spouses will eventually reach terms that each believe are fair. More discussion on this process exists below in the section titled, “The Mediation Approach.”
“The spouse seeking maintenance has made significant financial or other contribution to the education, training, vocational skills, career or earning ability of the other spouse”
Under the old rendition of the spousal maintenance law, Factor #3 read as follows:
“A spouse is eligible to receive maintenance where he or she contributed to the educational opportunities of the other spouse.”
Under the updated law, the legislature has included a more inclusive statement to better define the intent of the above statement. Specifically indicating ways in which a spouse can contribute to their spouse’s abilities to pay spousal maintenance.
“The spouse seeking maintenance had a marriage of long duration and is of an age that may prevent the spouse from gaining employment adequate to be self-sufficient”
Judges view the duration of marriage in a very subjective way. A duration that one Judge may consider “long” may not be regarded as “long” enough by another Judge. In regard to the duration of the marriage, generally a marriage of less than 10 years is considered short-term, a marriage of 10 to 20 years is considered medium duration, and anything over 20 years is considered a long-term marriage. Usually, spousal maintenance is not awarded for marriages of very short duration (for example, less than five years), but again, there is no set rule. Depending on the specific circumstances, even short term-marriages can qualify for an award of spousal maintenance.
This factor specifically looks at the issue where the duration is so long that the spouse seeking support is at an age that regardless of using maximum efforts possible, the spouse will never be able to gain employment to meet their reasonable expenses.
“The spouse seeking maintenance has significantly reduced that spouse’s income or career opportunities for the benefit of the other spouse.”
The new spousal maintenance law adds a fifth qualifying factor that expands upon the recipients contribution to the marriage. This condition defines the sacrifices a spouse may make to their own earning capacity for the benefit of the other spouse, causing them to need spousal maintenance due to a lack of individual financial stability. Factor #5 reads as follows:
“A spouse is eligible to receive maintenance where he or she has significantly reduced personal income or career opportunities for the benefit of the other spouse.”
Amount and Duration of Spousal Maintenance
If the court determines a spouse seeking maintenance is entitled to an award, it must then consider the relevant factors, balancing the equities between the parties and exercising its discretion as it deems just. The amount of spousal maintenance payments are determined by what the Judge considers to be a reasonable deduction from the monthly income of the paying spouse and a reasonable monthly payment to the receiving spouse. When determining the amount and duration of spousal maintenance, Arizona courts will look to the following factors:
- the standard of living established during the marriage;
- the duration of the marriage;
- the age, employment history, earning ability and physical and emotional condition of the spouse seeking maintenance;
- the ability of the other spouse to pay spousal maintenance while meeting his/her own needs;
- the comparative financial resources of the spouses;
- the extent the spouse seeking maintenance contributed to the earning ability of the other spouse;
- the extent the spouse seeking maintenance reduced their income or career opportunities for the benefit of the other spouse;
- the ability of both spouses to contribute to the future educational costs of their mutual children after divorce;
- the financial resources of the spouse seeking maintenance.
- The time necessary for the spouse seeking maintenance to acquire the education or training needed to find suitable employment, and whether such education or training is readily available;
- excessive or abnormal expenditures during the marriage;
- the cost of health insurance for the spouse seeking maintenance; and
- actual damages resulting from the criminal acts of either spouse on the other spouse or child.
There is no point system designated to each factor, or instruction to the Judge as to how each factor plays into the spousal maintenance determination. Instead, it depends on each individual Judge to determine what factors contribute to the amount and duration of spousal maintenance awarded.
Litigation Approach to Determining Amount and Duration of Spousal Maintenance
The most challenging part of the factors outlined above is that they do not provide any set formula to determine amount of duration of support. While child support determinations in Arizona are based on very specific guidelines established by State law, the courts have far more discretion when it comes to spousal maintenance.
In the past, Maricopa County courts used a spousal maintenance calculator to help determine spousal maintenance. This gave spouses the opportunity to gage support obligations. However, in recognition of the complexity of spousal maintenance, the court has held the calculator to be invalid. Now, the courts must conduct a full review of all spousal support factors outlined by law.
Today, there are no calculators or formulas that dictate how a Judge will determine an award of spousal maintenance. Therefore, there is no way of accurately predicting what a Judge will order. There is virtually no consistency among Judges, or even among individual Judge’s orders.
While the length of marriage and the comparative financial resources of the spouses are important considerations, an award of spousal maintenance will take heed to the reasonable needs of the requesting spouse in comparison to the ability of the spouse to meet that need. Perhaps the most important variable for those in litigation is the assigned Judge. Studies have shown that when multiple Judges were asked to award spousal maintenance given the same fictitious facts, spousal maintenance awards ranged in responses from no award of spousal maintenance to a lifetime award of spousal maintenance and everything in between.
The Mediation Approach
Those involved in a legal separation or divorce want to know what they can expect to pay or receive in spousal maintenance, and for what duration so they can plan their finances accordingly. Regretfully, as discussed above, spousal maintenance law in Arizona does not provide much guidance or relief. In mediation, we take a comprehensive view when approaching this sensitive subject.
Generally, the person requesting spousal maintenance has some shortfall in terms of the amount they need each month to be able to pay their expenses. For the person paying spousal maintenance, there is traditionally an amount they have remaining in excess each month after they have paid all of their expenses. In mediation, we assist our clients in preparing a Monthly Budget Worksheet in order for each spouse to reasonably, accurately, and realistically determine their anticipated expenses after divorce. After a series of discussions about each budget are completed, together with the help of their divorce mediator, spouses work on clarifying and balancing these expenses.
For example, parents may have a daughter who participates in gymnastics. The costs associated with this extracurricular activity might be $300 per month. Dad may assume he is paying the expense after divorce and include this in his budget. Mom may also assume she is paying 100% of this expense. When we review together, however, we see this and discuss how this expense will actually be paid. Perhaps it is agreed that Dad will pay 100% of this expense. Then, we adjust the figures: Dad’s overall expenses stay the same, but Mom’s are reduced by $300 per month. If Mom previously had a shortfall of $1000 per month, now, she only has a shortfall of $700.
By working creatively on agreements regarding expense division, and also by creatively agreeing on how assets are best divided, we can maximize benefit to both spouses and accomplish the best possible agreements regarding spousal support, so that both are as financially stable and secure as possible.
Mediation, unlike litigation, encourages creativity in ways in which spousal maintenance may be paid to create financial stability for both spouses. Spouses can even agree for payments to be made directly to certain vendors, instead of to the other spouse. Lump sum spousal maintenance is also a consideration that can benefit both spouses.
Who is Entitled to Spousal Maintenance?
Many people traditionally think of spousal maintenance as a payment from the former husband to the former wife, and historically this was most often the case. But the make-up of traditional marriage has evolved in the United States. Many marriages now including two wage earners. A Dad who works primary within the home while Mom is the wage earner has become more common as well. Therefore we also see payments from former Wife to former Husband. Additionally, same sex marriages also result in same sex payments of spousal maintenance. In other words, the gender of the spouse seeking maintenance has no effect on maintenance eligibility, amount, or duration, or does the sexual orientation of spouses.
Types of Spousal Maintenance
There are many forms of spousal maintenance, from set terms of duration to staggered plans that lower the amount of support over time. During the divorce process itself, a judge in Arizona may award temporary spousal maintenance or “pendente lite,” meaning pending the final divorce. This award is for maintenance during divorce proceedings to keep financial stability for both parties during the process. When the final order is entered, and the divorce is finalized, the judge may also order either temporary or permanent maintenance for a period of time. Even if temporary spousal maintenance is awarded during a divorce proceeding, this does not guarantee that spousal maintenance will be ordered after the proceedings have concluded, although it commonly is.
In mediation, we discuss temporary spousal maintenance agreements if clients are financially separating during the divorce process and need financial stability via support payments. Note that in mediation, instead of an order for temporary spousal support being unilaterally mandated by a Judge (which both spouses may be very unhappy about), in mediation spouses reach agreements together about the amount and duration of temporary spousal support with the help and guidance of a skilled mediator.
Although spouses may pay the other a lump sum spousal maintenance award, it is, or more commonly, a monthly amount for a specific length of time. Permanent spousal maintenance is becoming increasingly rare, even after longer marriages. Arizona courts tend to look at maintenance as rehabilitative—in other words, in place so far as to allow a spouse to find a job, or obtain training and education to improve employment prospects. In longer term marriages, depending on the circumstances, this can still mean longer term awards.
In some situations, a court may award limited maintenance as reimbursement to a spouse who contributed to the advanced education and earning capacity of the other spouse. Courts will generally only award long term maintenance to spouses who are unable to become self-supporting — due for example to age or disability — and even then, only after long marriages. Couples may always mutually agree to provide one spouse with long-term or permanent maintenance if both agree to this form of payment structure.
Termination of Spousal Maintenance
Generally, under Arizona law, spousal maintenance terminates upon:
- the remarriage of the spousal receiving support;
- the death of either spouse; and/or
- the termination of the spousal maintenance term.
Although this is the default under Arizona law, spouses may mutually agree to more or even less termination factors in mediation. Sometimes, the creative terms developed in mediation regarding termination of support can make the difference between stalemate and full agreement. For example, a payor may agree to a longer duration than the payor believes is most fair, in exchange for an added termination agreement that upon the recipient earning income of $60,000 per year or more, spousal maintenance is terminated.
Paying Spousal Maintenance
Spousal maintenance payments are traditionally ordered to be made through an Income Withholding Order from the paying spouse’s paycheck to the Arizona Support Clearinghouse. This means that the court’s order directs the employer of the spouse to deduct the amount of spousal maintenance directly from their paycheck, and then the employer sends this money to the Clerk of the Superior Court. The Clerk records the payment and sends the money to the spouse who is entitled to receive the spousal maintenance payment. Self-employed or unemployed spouses must make spousal maintenance payments directly to the Clerk of the Court.
In mediation, you can also mutually agree to have payments made via automatic direct deposit between the spouses. Some spouses prefer this method to avoid any State involvement in the action payment of support or for sake of convenience.
For example, where by agreement, the amount of spousal maintenance changes several times during a short period, the time and effort to record and institute those changes of amounts may be reason enough for some spouses with a relatively high degree of trust to agree that payments happen from payors bank account directly to recipients bank account automatically on the same day each month. Each situation is different and each spouse may have different thoughts the payment method that feels most safe and reasonable.
Are Spousal Maintenance Payments Taxable?
The new Federal Tax Law passed in 2017 has changed the tax liability of spousal maintenance payments.
As such, to the public’s general knowledge, if a divorce or legal separation is finalized (stamped by the court) before December 31, 2018, spousal maintenance payments will be tax deductible for the payor and taxed as income for the recipient, unless otherwise agreed. Tax deductibility to the payor of spousal maintenance is grandfathered in regardless of the length of spousal maintenance, so long as the divorce or legal separation is final prior to December 31, 2018. This means that payments will be deductible to the person paying support and taxed as income for the person receiving support.
However, if a divorce or legal separation is finalized after December 31, 2018, spousal maintenance payments are not tax deductible to the payor and not taxed as income to the recipient.
Modification of Spousal Maintenance
As a default, spousal maintenance awards in Arizona are modifiable. Although a court would traditionally only order the award as modifiable, parties may mutually agree in mediation that it will be non-modifiable, meaning that the amount or duration can never be changed under any circumstances.
In most cases, if a spouse chooses to waive spousal maintenance in mediation or litigation, you are forever forfeiting your right to spousal maintenance, however by agreement in mediation, this can be altered. Upon forfeiting spousal maintenance forever, only a mutual agreement by the parties at a later date can result in a new spousal maintenance agreement being enforced. Otherwise, a court may not modify spousal maintenance unless an original order contained an award of spousal maintenance.
Arizona law requires that there be a substantial and continuing change in circumstances in order to modify spousal maintenance. Whether a change has occurred is determined by comparing the current circumstances of the spouses at the time of the entry of the spousal maintenance order to the circumstances of the former spouses at the time of a modification request. In other words, changed circumstances alleged must be proved by a comparison with the circumstances existing at the time of the original divorce. In court, the burden of proving changed circumstances is on the party seeking modification.
In mediation, we also provide services for former spouses requesting changes to their original divorce decree, also known as post-decree modification. In these mediation meetings, spouses may mutually agree to modify spousal maintenance payments, even without a substantial and continuing circumstance.
Spousal Maintenance Modified Due to Loss of Income
Perkins v. Perkins (AZ Court of Appeals Div One) addressed the question of changed circumstances for the purpose of modifying a spousal maintenance order and what constituted ‘continuing‘ (as opposed to temporary) changed circumstances.
The Perkins case tells us:
- failure to negotiate and/or recognize the reality of the circumstances will be considered unreasonable;
- failure to make appropriate disclosure will be considered unreasonable; and
- a single factor is sufficient to justify modification of a spousal maintenance order.
Are Prenuptial Agreements regarding Alimony Enforceable in Arizona?
A couple may choose to limit or eliminate spousal maintenance through a prenuptial agreement, which is an optional contract signed by the parties before marriage. Upon divorce, the court may uphold the couple’s agreement and disqualify a spouse from receiving spousal maintenance, where the court finds the premarital agreement is valid. Arizona law does provide an exception where a spouse would become eligible for public assistance or welfare benefits absent support. If this is the case, the court may decline to uphold an otherwise valid prenuptial agreement.
In divorce mediation, often times spouses follow the prenuptial agreement. However, spouses may also, after understanding the implications of the prenuptial agreement, agree to do something different.
For example, a premarital agreement signed 20-years prior to the decision to divorce may read that “in the event of divorce, neither party shall pay the other spousal support.” At the time of the premarital agreement signing spouses may have had no children and Wife may have been earning more income than Husband. However, soon after marriage spouses may have had children, and a mutual decision may have been made that Wife work within the home and care for the parties children. As a result Wife remained unemployed for nearly 18-years. Today, parents are agreed that after divorce they will share equal time with their three children, but Wife is only capable of earning minimum wage, while Husband is earning $80,000 per year. Parents may very well decide here that even though the premarital agreement states “no spousal support,” that it is still necessary and agree to reasonable payments to allow financial stability for both parents though discussion in mediation.
Spousal Maintenance Enforcement
Judgments for spousal maintenance are strictly enforced by the court and are non-dischargeable in bankruptcy. If a spouse fails to pay court-ordered maintenance, there are options for enforcement actions through the court.
For example, the court can place a lien on the property of the spouse defaulting on payments, seize the tax returns of said spouse, collect through an income withholding order, or levy against a bank account of said spouse. The deadline to request a judgment for unpaid support is three years after the order has terminated. After securing a judgment, it need not be renewed. The judgment will remain in full force and effect. Further, failure to pay the judgment is a class 1 misdemeanor.
We hope this article has been illuminating as to the factors considered when determining spousal maintenance in Arizona. As we have discussed, these guidelines apply in both litigation or mediation, but mediation may allow for more productive conversations that result in deviations that better reflect what both parents believe is most fair.
The Arizona Support Guidelines, while at times complicated, create a general guide of factors that may lead to a spousal maintenance award. Regretfully, the guidelines leave a great deal of interpretation based on the Judge presiding over the case. A skilled professional family mediator can help you have a productive conversation considering these factors to help you reach the best possible agreement for both spouses moving forward.