How is alimony calculated in TN?

The court process for calculating alimony in Tennessee is the same for all divorces. Yet outcomes differ. Reason being? There is no official alimony formula.

Yes, estimating alimony will involve arithmetic. But simply plugging numbers into an app is not enough. How much alimony a spouse will receive or be ordered to pay requires an individualized statutory analysis.

While Tennessee alimony is not “calculated” in a formula, courts are required to hear and weigh evidence on two primary concerns:

The spouse’s need for support; and
The other spouse’s ability to pay.

The statutory factors that courts must consider are very important, even crucial to the court’s calculation. Factors include the realities of age, health, number of years married, marital fault, and more.

THERE ARE THREE BASIC STEPS TO THE COURT’S CALCULATION.

Step 1. Determine the spouse’s need for support.

The legal basis for need is the projected reasonable expenses of that spouse post-divorce, the foundation of which is the spouses’ shared lifestyle during their marriage.

The supported spouse will have some earning capacity factored in. That is, unless the supporting spouse’s income is high. Or if child-rearing demands suggest the supported spouse need not work. Child support is also factored in.

Establishing the spouse’s need for support requires calculating his or her income from future income. That future income is based on earning capacity. We then reduce earning capacity by projected reasonable expenses.

Step 2. Determine the supporting spouse’s income.

The supporting spouse’s income is usually known by his or her historical earnings. Is there a work history of unemployment or underemployment? Talk to an experienced divorce attorney.

Step 3. Examine the parties’ marital spending.

Tennessee courts project the supporting spouse’s reasonable expenses from the parties’ spending history during the marriage. In shorter marriages, courts look back three to five years. For longer marriages? When the supporting spouse’s projected lifestyle is high, then that, too, may be considered in the supported spouse’s calculation.

HOW IS ALIMONY ORDERED?

A family law judge always look at the situation:

The spouses’ specific circumstances;
Length of the marriage;
The spouse’s need and ability to pay; and
The purposes and type or types of alimony being sought.

Tennessee law allows four types of alimony:

Rehabilitative alimony;
Transitional alimony;
Alimony in futuro (aka periodic alimony); and
Alimony in solido (aka lump sum alimony).

(See Tenn. Code Ann. § 36-5-121(d)(1).)

In application, we focus first on the supported spouse’s actual need. Then we pair that need with the best fitting alimony type.

For example: After a six-year marriage, the supported spouse needs money for career training and relocation out-of-state. Because transitional alimony is only possible when rehabilitative alimony is not feasible, lump sum alimony plus rehabilitative alimony may be the best fit.

WHERE DOES THE ALIMONY CALCULATION PROCESS BEGIN?

To arrive at an alimony amount, the judge applies each relevant factor listed in § 36-5-121 of the Tennessee Code. One aspect of the calculation looks at dollars and cents. Namely, the parties’ economic circumstances and future earnings capacity. This includes wages and salaries, deferred compensation, pensions, passive income, assets, expenses, and taxes. Another aspect of the calculation looks at their ages, years married, minor children, health, and lifestyle. Yet another aspect of the calculation looks at marital fault.

The court factors in each spouse’s fault and their respective fault.

What did a spouse do that contributed to their divorce? A few examples of marital fault are an:

Extramarital affair;
Addiction that dissipated marital funds or wasted assets;
Abandonment; or
Domestic violence.

Understand that alimony is not a tool for punishing a spouse.

For example: A spouse who was the child’s primary caregiver needs rehab alimony to complete a vocational program. That spouse should not be punished for quitting college two years before their child’s birth.

How soon should you start preparing your alimony case?

Start early! Before the divorce is filed if possible. Temporary alimony is frequently ordered to support and maintain the spouse in a pending divorce. Prepare for alimony by discussing anticipated post-divorce finances, career and educational objectives, and transitional assistance for new living arrangements. Your attorney will explain how alimony is negotiated.

Can spouses negotiate alimony calculations with their attorneys’ assistance?

Yes. Understanding the purposes of alimony helps parties negotiate reasonably and productively.

Using the alimony factors in the statute for guidance, spouses can make their own calculations. They can hire their own experts. They can emphasize those factors of greatest importance to them and de-emphasize those factors that are not.

For example: The marital home needs costly repair. The spouses agree to emphasize payment of lump sum alimony over a period of two years and de-emphasize any pressure to immediately sell the asset. This allows time and resources for repairs. So, the real estate can be listed in top-condition at an optimal price.

What if no agreement is reached despite negotiation and mediation?

Expect the court to determine what alimony will look like. A judge may enter orders that seem harsh to one party or overly generous to the other.

If a party disagrees with the judge’s final decision, then an appeal can be filed. However, appeals are costly with no guarantee of a win. Carefully consider your options after consulting an experienced divorce attorney.

Remember the main objective. To establish one spouse’s need for support and the other spouse’s ability to pay.

Each alimony type has specific criteria. In determining how much of what type should be awarded (if any), the court’s weighing of evidence and balancing of the parties’ positions could quickly morph into a complex analysis. The more resources, assets, earnings, and conditions involved, the more the court has to review and consider, which is why alimony proceedings can benefit from expert opinions.

In negotiating alimony terms for a Marital Dissolution Agreement (or MDA), expert testimony can help clarify the type and amount of alimony reasonably needed. For instance, an independent forensic accountant conducts a lifestyle analysis, or the rehabilitation expert testifies on a spouse’s earning capacity. Mediation, too, can play a big role in answering the alimony question.

To learn more, view How is alimony decided in Tennessee?