There are extra considerations when high net worth couples move forward with a divorce. For spouses with one or more high incomes and a significant amount of investments, dividing shared property and determining future financial obligations can be stressful, if not contentious. Spousal maintenance, or alimony, is one of these additional considerations in high net worth divorces, particularly if one individual was the primary provider. In Illinois, maintenance in high net worth divorces is left up to the discretion of the judge.
Illinois Maintenance Formula Does Not Apply
The spousal support formula outlined in the Illinois Marriage and Dissolution of Marriage Act (Act) provides an objective standard for how much maintenance should be awarded to the payee spouse and for how long. However, the formula is for a combined gross yearly income of no more than $250,000. High net worth couples can greatly exceed this income, which means judges have discretion in determining how much should be awarded.
Determining Maintenance is Appropriate
Before judges decide how much spousal support should be awarded and for what duration, they must make the initial determination that any spousal support is appropriate. Judges will look to Section 504 of the Act, which offers factors to consider in awarding support such as:
- Each person’s income and property, including divided marital assets
- Each spouses’ needs
- Each person’s present and future earning capacity
- Any impairments to a person’s present or future earning capacity due to his or her focusing her time on domestic obligations and forgoing education, training, or career opportunities because of the marriage
- The duration of the marriage
- The standard of living during the marriage
- The age and health of each spouse
Determining the Amount and Duration of Support
Judges have discretion in determining how much spousal support to award for high net worth couples. However, a judge’s decision should be based on sound reasoning. When deciding on an appropriate amount of support, a judge may consider the standard of living the couple and their children enjoyed during the marriage as well as each person’s individual earning capacity to maintain that standard moving forward.
Illinois law provides a formula for deciding how long maintenance should last based on the duration of the marriage. Judges can use this formula for high net worth divorces or they can use their discretion in determining an appropriate length. Under the law, marriages of 20 years or more can result in maintenance the length of the marriage or permanent maintenance. This may be true for high net worth marriages of this length as well.
Negotiating Spousal Maintenance
If you are seeking spousal maintenance during a high net worth divorce, speak with your attorney about negotiating a property settlement and maintenance plan. Illinois law allows for spouses to come to an agreement regarding property division and support as long as it is not an unfair contract. Instead of having a judge determine maintenance, you and your spouse can negotiate a property settlement and support obligation that benefits both of you and keeps potentially harsh tax consequences in mind.
The Attorneys of Fay, Farrow & Associates can Help
Spousal maintenance is only one of the additional factors you, your spouse, and your attorneys must take into consideration during a high net worth divorce. Depending on your circumstances, it may be best to negotiate an advantageous one-time property settlement in exchange for receiving less support in the future. However, you may also be in the position of needing maintenance in order to maintain your lifestyle. Whatever you need, the experienced divorce attorneys of Fay, Farrow & Associates will help you get it. Call us today 630-961-0060 to schedule a free consultation.