INTRODUCTION ON FLORIDA ALIMONY REFORM 2023
Florida alimony reform is here. Our legislature passed, and the governor signed, a transformative overhaul to §61.08, Florida Statutes, commonly referred to as the Alimony Statute. As of July 1, 2023, Florida has virtually eliminated new awards of permanent alimony, codified temporary alimony, and implemented limits to the length and amount of alimony a court could order. The Alimony Statute now only refers to the following types of alimony (also known as spousal support or spousal maintenance): Temporary, Bridge-the-Gap, Rehabilitative, and Durational, each of which can be paid over time or in a lump sum. In this blog post, we explore each and highlight some of the recent significant changes.
Keep in mind that, though this is now the default law and limits what courts can order, spouses can always agree to do things differently through a private process such as Collaborative Divorce or mediation.
NEED AND ABILITY TO PAY
Before alimony can be awarded, a court must first determine whether one spouse has an actual financial need, and whether the other spouse has the ability to pay and meet that need. The burden is on the party requesting alimony to show both their need and the other party’s ability to pay. Though determining need and ability to pay may seem straight forward, the issue becomes a lot murkier when one of the spouses has inconsistent income because they are a small business owner, executive with a unique compensation package, or a seasonal worker.
Additionally, though seemingly obvious, many people seeking alimony do not realize that the household income that once supported one home may now have to stretch and support two, and there may or may not be sufficient funds to cover both. It is with this in mind that the new statute considers an additional factor in analyzing need and ability to pay: the anticipated financial needs and necessities of life for each party after the divorce is over.
LENGTH OF MARRIAGE
There are many factors a court may take into consideration when determining an alimony award. However, one of the major changes is how the court measures the length of the marriage. Now, the Alimony Statute defines a short-term marriage as one that last less than 10 years, a moderate length marriage as 10 to 20 years, and a long-term marriage as exceeding 20 years. Traditionally, the length of marriage is measured from the date of marriage until the date of filing for divorce or another date as agreed upon by the spouses. In a Collaborative Process, where many cases do not get filed until after a full resolution is reached, we tend to use a date listed in a Collaborative Participation Agreement in place of the date of filing.
Temporary alimony is interim support given while divorce proceedings or a Collaborative matter are ongoing. It is meant to provide and maintain the financial status quo of the marriage until there is finality on all the issues in the matter. The courts have traditionally granted these awards as interim solutions until the appropriate alimony award can be determined or otherwise agreed upon.
Bridge-the-gap is awarded to assist a spouse that needs help in making the financial transition to single life. This form of alimony may not exceed two years in length, and is non-modifiable, in both duration and amount. While this form of alimony does not have a specific formula for calculation, it may not leave the payor (paying party) with significantly less net income than the receiving party (payee), without finding for exceptional circumstances.
Rehabilitative alimony is appropriate when there is a need to help a spouse develop certain skills or credentials in becoming self-supporting, allowing that spouse time to acquire necessary additional education, training, or experience, in order to obtain better employment. Rehabilitative alimony requires a specific and defined plan to accompany the award. It may not exceed five years, and can be modified or terminated if the plan is completed before the length of the award was originally set to expire.
In addition, it can be modified or terminated if there is a substantial change in circumstance, or upon a showing of noncompliance by the receiving party to adhere to the specified plan. This type of alimony does not have an exact calculation method either. However, it cannot leave the payor with significantly less net income than the net income of the recipient without finding of exceptional circumstances.
This type of alimony saw the most change in the recent reform. First, the statute prohibits a court from awarding durational alimony for a marriage lasting less than 3 years in length. The maximum length of durational alimony awarded is directly related to the length of the marriage. Durational alimony for a short-term marriage (less than 10 years) cannot exceed 50% of the length of the marriage. For example, a 5-year marriage cannot be awarded durational alimony that exceeds 2.5 years in length. Alimony for a moderate length marriage (10 to 20 years) may not exceed 60% of the length of the marriage, and alimony for a long-term marriage (over 20 years) may not exceed 75% of the length of the marriage.
There are also new limits on the amount of durational alimony that a court can award: it can either be the reasonable need of the recipient party to the extent that the payor can afford it, or an amount not to exceed 35% of the difference between the party’s net incomes, whichever is less.
Let us look at the following example: A wife makes $100,000 in net income annually. Her husband makes $40,000 in net income annually. Her husband shows that he has the need for $25,000 a year in alimony and that his wife has the ability to pay this amount. A court will calculate whether this exceeds the maximum amount it could award as follows: $100,000 (wife’s net income) minus $40,000 (husband’s net income) equals $60,000 (the difference between the spouses’ incomes). The court will then multiply $60,000 by 35% and find that the maximum amount it could award is $21,000 per year in durational alimony. Because this amount is less than the husband’s proven need and wife’s ability to pay of $25,000 per year in alimony, the court will go with the lower number and determine that the husband may only receive up to $21,000 per year in durational alimony.
While it’s true that permanent alimony is no longer referenced in the Alimony Statute, this only affects newly filed cases or those cases that were pending on or after July 1, 2023. There is no retroactive clause that eliminates permanent alimony in awards that were already ordered by a court prior to July 1, 2023.
Further, a court may extend the length of a durational alimony award if there is clear and convincing evidence of exceptional circumstances. A court may consider the age, employability, and financial resources that limit the receiving party’s ability to become self-supporting. The court may also consider the mental or physical disabilities that render the receiving party unable to become self-supporting. A court could also consider whether the receiving party is the primary caregiver to a mentally or physically disabled minor or adult child common to both spouses (this factor terminates upon the child’s death or when the child no longer requires caregiving). So, in essence, under these exceptional circumstances, permanent alimony lives on.
Additionally, a court may combine various types of alimony if one is insufficient to meet the reasonable need of a spouse. Again, to do this a court will consider what is the reasonable need of one spouse and what is that other spouse’s ability to pay and meet that need.
Florida alimony reform has changed how the courts determine awards of spousal support. Judges will undergo a complex analysis and dive deep into both spouses’ income, expenses, assets, and debts. While the new Alimony Statute establishes limits and may create more uniformity in alimony awards, there is still a lot of uncertainty in how these changes will be implemented. For example, determining one spouse’s need and the other spouse’s ability to pay is not as straight forward as it seems, especially when one spouse is a small business owner or executive with an irregular compensation structure.
Fortunately, rather than rely on a court to impose a solution on you, you can create your own outcome in a private dispute resolution process such as Collaborative Divorce or mediation. Every situation is different, and we welcome the opportunity to discuss the ways to navigate the changing alimony landscape with you.
Britney Penaherrera is a Collaborative Lawyer and Florida Supreme Court Certified Family Law Mediator. She has been selected to participate in the Leadership Institute of the Florida Academy of Collaborative Professionals. Britney practices exclusively in out-of-court dispute resolution.