There are two types of support payments available in Texas: spousal maintenance and contractual alimony. Spousal maintenance is authorized by the Texas Family Code and may be court-ordered if the parties meet certain legal criteria. By contrast, contractual alimony is based on IRS provisions and an agreement between the parties. Spousal maintenance payments are strictly limited in amount and duration while contractual alimony payments can be for any amount and length of time.
1. Eligibility for Spousal Maintenance
In Texas, eligibility for spousal maintenance is limited by law. Maintenance may be awarded in cases of adjudicated family violence, disability of a spouse or child of the marriage, and for marriages of more than ten years. Maintenance is generally intended to support a former spouse while she finishes her education or acquires necessary work skills. One way to qualify for spousal maintenance in Texas is to be married more than ten years, lack sufficient assets, and have little education or few work skills. Other eligibilities include victims of adjudicated family violence, individuals suffering a disability, or persons caring for a disabled child. Most individuals who qualify for spousal maintenance are stay-at-home moms who haven’t worked for years. However, she will forfeit the right to maintenance if she does not actively seek employment or pursue education.
2. Limits on Spousal Maintenance
When maintenance is based on disability, the payments may continue so long as the person or child of the marriage is disabled. Maintenance based on family violence may last no more than five years. Otherwise, the duration of maintenance payments depends on the length of marriage. If the marriage lasted between ten and twenty years, payments can be for up to five years. If the marriage lasted for twenty to thirty years, payments can be for up to seven years. And for marriages over thirty years, spousal maintenance can be ordered for up to ten years. The maximum amount of spousal maintenance that may be ordered by a court is $5,000 or 20% of the paying spouse’s gross monthly income, whichever is less. In setting the amount of maintenance, a court looks at the spouse’s “minimum reasonable needs,” each spouse’s ability to provide for their minimum needs, what assets each spouse received in the divorce, and the paying spouse’s ability to afford maintenance. Maintenance terminates if either party dies or the receiving party cohabits or remarries.
3. Contractual Alimony
Contractual alimony may be agreed by the spouses and approved by the court. It terminates on the death of either party and may terminate if the receiver cohabits or remarries, depending on the agreement. The IRS may disallow a tax deduction if the alimony payments are heavily loaded toward the beginning. One advantage of alimony is that the spouse with a higher earning capacity can deduct the payments from his income. The receiving spouse will pay tax on the alimony income, but at a lower rate. The duration and amount of contractual alimony are set by agreement of the spouses, but cannot be ordered by a court.
The advantages of spousal maintenance are that it can be court ordered and enforced by contempt if a spouse refuses to pay. The disadvantages of spousal maintenance include strict eligibility requirements and limits on the amount and duration of payments. There are several advantages to contractual alimony, if the parties can agree on terms, because payments can be tailored to specific family needs. For example, if a husband earns a high income and wants to support his children’s private education, he can specify that the alimony payments be sent directly to the school as long as the children are enrolled. If the wife wants to stay in the family home with the children, but can’t afford the mortgage payments, the husband can agree to pay alimony so long as she stays in the home with his children. This way, he is able to keep his children in the family home and close to him so he can maintain his parental relationship.