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Posted by ekjadmin on August 25, 2010
Many people ask me how alimony is calculated in Utah divorce actions. Unlike child support, which is principally calculated on a statutory arithmetical formula, calculating alimony does not follow a single or even a set method. Notwithstanding, the most commonly utilized starting point when calculating alimony is an “income equalization” formula, which I will demonstrate below:
In this very simple hypothetical setting, the husband, John, and his wife, Jane, are getting divorced. John and Jane have two children, with primary physical custody awarded to Jane.
While men can, in theory, receive an alimony award, husbands in Utah typically out-earn their wives in the majority of divorce cases, which makes the award of alimony to men a rarity. So we will calculate alimony based upon John earning more than Jane.
John’s gross monthly income = $5,000
If John or Jane were self-employed, we would subtract any necessary (not merely legal, but necessary) business operating costs from his/her income to arrive at a before-tax gross income amount.
Jane’s gross monthly income = $1,300
John’s net income is calculated, for alimony purposes, as his net income less his child support obligation (remember, Jane was awarded primary physical custody). Where John’s gross income is $5,000 and Jane’s gross income is $1,300, John’s child support obligation to Jane would be $1,047 per month (believe it).
John’s net income would be calculated by subtracting state and federal income taxes from his gross income.
John’s net income, after subtracting federal and state income tax, = $3,970 after tax net income – child support of $1047 = $2,923 net income
Jane’s net income = $1,180
John’s net income + Jane’s net income = $4,103
Combined spouse’s net income (i.e., $4,103) ÷ 2 = $2,052
$2,052 – Jane’s net income (i.e. $1,180) = $872, which roughly equals Jane’s alimony award on an income-equalization basis.
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