If you’ve known friends or family members who’ve gotten divorced in Illinois, you may feel at least somewhat familiar with the process. You may have heard about certain aspects from that loved one—how things work or how the law played out in their specific scenario. However, it’s vital to remember that the law applies to everyone’s divorce scenarios in different ways. And, even more importantly, laws can change—they can be updated and altered.
You should consult with a lawyer before making any assumptions about a settlement. One thing to keep in mind is that Illinois law regarding alimony changed drastically in 2019. Anything you’ve heard from friends or family on this element of divorce settlements no longer applies.
The new alimony rules:
The main changes to the alimony rules are to the tax implications. Previously, alimony was tax-deductible for the payor and the payee had to list it as taxable income. However, the rules changed in 2019.
For your any divorces filed after January 1, 2019, the following rules apply:
- The payor must pay taxes on alimony payments
- The recipient does not have to list alimony as income, which provides a significant tax break
- Spousal maintenance is calculated from net income, not gross income
- Maintenance cannot exceed 33.3% of the payor’s net income.
- There is a 40% cap on net income for allowable spousal maintenance
- The soft cap for child support and alimony is 50% of a payor’s net income
The new rules heavily favor the recipient of spousal maintenance. However, an experienced attorney can advocate for the best possible arrangement for you no matter what side of the fence you find yourself on.