Edward R. Weinstein, Esq.

What is a New Jersey Alimony “Buyout?”

No one, and I mean NO ONE, likes to pay alimony to their “ex.” It does not matter if you make $500,000 per year or $50,000. It does not matter if you are the husband or the wife (although I recently blogged that in my nearly 20 years of experience as a New Jersey Divorce Attorney women seem to hate it even more). It does matter if you were the “cheater” or they were the “cheater.” No one wants to pay. As a creative New Jersey Alimony Lawyer, I am aware of one way to avoid my client from having to write that heinous check; an Alimony “Buyout.” Please allow me to explain by way of example.

NJALIMONY.png

About ten years ago I represented a nice gentleman who was a professor at Rutgers University. Married and with my client earning much more money than his wife, he was looking at paying permanent NJ alimony. My client acted as if he had just received a death sentence. Then it was time for this New Jersey divorce lawyer to get creative. To wit, the marital home was well worth over $1 million with no mortgage. Long story short, my client waived his rights to his share of the marital home in exchange for no alimony. Both sides were satisfied. The wife retained the marital home and my client did not have to write his “ex” even one solitary check.

My client made this deal for a number of reasons:

First, by using the real estate appraisal and calculating the anticipated total amount of alimony to be paid over the years (including “tax effecting this amount), I advised my client that it was a fair financial exchange. When I say “tax effect” the numbers I mean that we have to take into account that the alimony my client would have paid is a tax deduction for him and reportable income for his “ex.”

Second, while my client was walking away with less liquid assets, he did not have to face the fear that most people who pay alimony confront; am I going to be able to pay this now or in the future? Am I going to lose my job and if I do, am I going to be able to have the amount lowered or eliminated? On the other hand, if my client’s income went up dramatically, his “ex” could not bring him back to New Jersey Family Court for an increase in alimony. In fact, I built language into the Property Settlement Agreement that because the wife received the marital home free and clear, she could never have alimony revisited. This is known in New Jersey divorce law as “anti-Lepis” language;

The bottom line here is that my client was happy he certainty moving forward, and that in and of itself had a “value.”

Finally, while we were aware that while his “ex” had a new boyfriend, my client was convinced his wife would never remarry (which would immediately terminate alimony). Furthermore, while she may have “shacked up” with her new boyfriend, I explained to my client that New Jersey alimony laws are (in my opinion) unfair to the payor of alimony. Simply put, bringing your “ex” into court to reduce or end alimony is a very difficult and expensive endeavor in order to prove your case.

As I frequently discuss, New Jersey Divorce case involving Alimony are almost always contentious and difficult to settle. This is a great example of steam lining the process. If you or someone that you know is thinking about getting divorced but worried about alimony, please contact this New Jersey Divorce Lawyer.