High net worth divorces can be incredibly complicated affairs, involving much debate over financial concerns, property division, child custody, and many more factors. A straightforward divorce may involve heightened emotions, frustrations, and financial uncertainty, high net worth divorces have all these and more. One of these complicating factors may be the question of spousal support.
Spousal support, often called spousal maintenance, is a regular payment of money from one spouse to the other to support them on their way to becoming financially independent. However, determining spousal support for high net worth divorces is rarely simple. One must understand how the state calculates spousal maintenance amounts, as well as the various factors of the divorce that may influence the decision.
A skilled Chicago family law attorney from Johnson O’Keefe may be able to help explain the particulars of a spousal support case. Consider scheduling a consultation by calling our experienced legal team at (312) 319-4444.
Spousal Support in Illinois
Spousal support in Illinois (often called alimony in other states) is determined by examining many relevant facets of the couple’s lives, financial situations, needs, and marital circumstances. Spousal maintenance is designed to support and alleviate financial strain on a spouse who may not have been the primary source of income in the household. This extra financial assistance allows them time to become financially independent.
High net worth divorces may interact with spousal support differently, depending on the incomes of each spouse, the differences in their earning potentials, and the presence of any complicating factors such as business ventures or valuable property.
Who Qualifies for Spousal Support in Illinois?
Spousal support in Illinois is awarded on a case-by-case basis and is therefore not guaranteed for any individual. However, many factors can influence the divorce case and affect whether or not an individual receives spousal support. These factors may be facets of the marriage itself, such as the length of the marriage or the standard of living established during the relationship. They may also take the division of marital assets into account, especially in high net worth divorces.
However, courts will also consider the financial position and needs of both spouses to determine spousal support awards. A spouse with reduced earning capacity or lower income may be eligible for spousal support, assuming they are unable to maintain a certain standard of living without support. Child custody may also affect spousal support awards, as the custodial parent may have additional financial needs to consider.
For more information, consider speaking with an experienced family law attorney from Johnson O’Keefe.
Does the Husband Always Pay Spousal Support?
While many may assume that the husband always pays spousal support, this is generally a misconception. Spousal support is not automatically guaranteed to either spouse. However, because it is not uncommon for the husband to be the primary source of income for a family, this may lead to the misconception that the man always pays spousal support.
How is Spousal Support Calculated?
According to Section 750 ILCS 5/504, the courts may decide to award spousal support when the combined income of both spouses is less than $500,000 and the payor is not actively paying spousal support or child support from a previous marriage. The court may also take extraneous circumstances into account when determining when to grant spousal support. This may affect high net worth divorces, as higher incomes may disqualify spouses from receiving spousal support.
Should the courts elect to grant spousal support, the amount is generally calculated by taking 33 ⅓% of the payor’s net annual income and subtracting 25% of the payee’s net annual income. However, this amount may not exceed 40% of the spouses’ combined gross annual income. In certain circumstances, the courts are permitted to award an amount different than the one calculated under section 750 ILCS 5/504, but they must provide adequate reasoning and inform the parties involved of the amount calculated by the above formula.
Spousal Support Differences in High Net Worth Divorces
High net worth divorces generally have different processes and guidelines than standard divorces, and being aware of the nuances may help protect wealth and navigate the legal landscape effectively. Valuable assets and high incomes can affect the decisions of the courts when it comes to financial matters, specifically spousal support.
Income Thresholds Affecting Spousal Support
High net worth divorces may often involve large incomes, and perhaps multiple incomes from either spouse. Business ventures may also provide passive income for one spouse or the other, which may increase the income threshold that the courts consider. If the income threshold of the couple is too high, they may not be considered for spousal support during the divorce proceedings.
As per Illinois’s guidelines regarding spousal support, spousal maintenance is only awarded if the combined income of both spouses is lower than $500,000 annually. While there are some notable exceptions, this threshold is the general rule. While some divorces may be considered high net worth due to existing marital property, others have high income thresholds that could disqualify them from spousal support.
How Property Division May Affect Spousal Support
In addition, the division of marital property may also affect the court’s decision to award spousal support in high net worth divorces. According to 750 ILCS 5/503, Illinois is an equitable distribution state, not a community property state. This means that property is divided in a way that the courts deem fair with respect to the length of the marriage, the financial contribution of each spouse, and the financial needs of each spouse.
In certain cases, the courts may elect to shift the distribution of property to compensate for a lack of spousal support. Instead of giving less property and awarding spousal support, it may be simpler for the divorcing couple to simply divide the assets differently without having to handle the complexities of spousal support.
Contact a Chicago, Illinois Family Law Attorney Today
High net worth divorces can be stressful endeavors, not only involving the emotional turmoil and frustrations of a divorce journey but also numerous financial and legal challenges. Navigating these challenges can be difficult, and could potentially lead to significant financial loss if handled incorrectly.
Understanding the relevant spousal support and divorce laws in Chicago may be able to help make a path to a more favorable agreement. This could lay a foundation for moving forward in financial success. An experienced Illinois family law attorney from Johnson O’Keefe may be able to help clarify these laws and help navigate high net worth divorces. Consider contacting the office today by calling (312) 319-4444 for a consultation.