With the current administration implementing a Reduction in Force (RIF), many individuals have undergone layoffs, furloughs, and deferred payroll.
For those who are in the middle of a divorce, pay alimony or child support, or who are separated and have minor children, the financial uncertainty couldn’t have come at a worse time.
Effects of Job or Income Loss and the Current Economic Climate on Alimony, Child Support and the Division of Assets.
Going through a divorce is difficult even without the stress of a job or income loss and the related uncertainty.
Given the shifting landscape, there are several key considerations one can take, whether you are:
- Contemplating a divorce – or already in the middle of one;
- Undergoing a job or income loss (or your spouse is) in a divorce;
- Paying or receiving alimony or child support; or
- Separated and have minor children.
Several strategies can help alleviate the financial strain in these situations.
Timing is Everything
If you are thinking of divorcing your spouse, are divorced and are paying alimony or child support, or have minor children, you need to consider timing when considering if you want or need to take further steps.
The first option you should consider is whether you want to proceed swiftly by filing in court. Conversely, you may benefit by hitting the pause button on litigation, looking for an alternative path for resolution, and using this time to gather information.
Loss of Job or Income May Affect Alimony and Child Support
Changes in the income of an individual who (1) is contemplating divorce, (2) is already divorced and pays alimony or has minor children, or (3) is separated and has minor children, may affect alimony and child support.
- If you are contemplating divorce, and you or your spouse experience a loss of job or income, then the spouse who suffered that loss may now look to the other spouse for support.
- If you are divorced and pay or receive alimony or child support, and either you or the person you pay or receive alimony or child support from experiences a loss of job or income, that support may be able to be modified.
- If you and your co-parent are no longer together and have minor children, and either you or your co-parent experience a loss of job or income, child support may be ordered if there is none currently in place, or if there is child support in place that support may be able to be modified.
In many courts, you may only receive, or are likely to only receive, alimony or child support retroactive to the date you file such a request in court. Similarly, if you want to modify or terminate the support being paid, you may only do so retroactive to the date you file such a request in court.
If you need support or a modification or termination of support, it likely behooves you to file promptly because every day that you delay, you are delaying a day in which you could be receiving support.
If you feel that you are getting the financial support you need, you may want to consider not doing anything or waiting to divorce until you feel more stable.
Maryland and DC Alimony and Child Support Laws
In both Maryland and DC, alimony may only be awarded retroactive to the date of filing a request in Court. However, there are key differences between jurisdictions.
In Maryland:
- Alimony is modifiable, unless you agree otherwise or waive alimony, as circumstances and justice require upon the filing of a request by either party. The modification may be retroactive to the date a request for modification is filed.
- Child support may only be awarded retroactive to the date of filing a request in Court.
- Child support is always modifiable upon a material change of circumstances, and the modification may be retroactive to the date a request for modification is filed.
In DC:
- Alimony is modifiable, unless you agree otherwise or waive alimony, upon a substantial and material change of circumstances. Like in Maryland, the modification may be retroactive to the date a request for modification is filed.
- Child support may be ordered retroactive up to 24 months before you file a request in Court
- Child support is modifiable upon a substantial and material change in the needs of the child or the ability to pay of the responsible party, and the modification may be retroactive to the date a request for modification is filed.
If you pay or receive alimony or child support and you experience a loss of job or income, you should immediately consult a family law attorney to see if you can and need to file to modify the support obligation in your Court order. Filing immediately may be key to preserving the retroactivity of your claims.
The Economic Impact of Job Loss on the Market May Affect Your Divorce
With the current administration’s policy changes, the economy and stock markets are in flux.
This may cause those getting divorced difficulty getting their arms around the facts and the values of assets that will be divided. Any valuations or appraisals that were conducted in the last year may need to be redone or updated in light of the economic shifts.
Some feel that the real estate market is also impacted, so those getting divorced may want to consider or reconsider if selling or keeping any real estate is in their best interests. Those getting divorced may be able to maximize each spouse’s financial resources upon divorce by negotiating with their spouse or waiting to divorce until they feel more stable.
If you are considering divorce or in the middle of a divorce and your or your spouse’s job or income was lost or is at risk of being lost, it is an important time to think about your future plans.
Strategize with your lawyer (and implement those strategies), and work on gathering information that will be necessary when your divorce process gets underway. Find out from your attorney what “homework” you can do with any downtime you might have right now so that you can be in the best position possible when ready to proceed.
If you aren’t going to hit the pause button on your divorce, rest assured that you have options.
Family law attorneys are available, courts are open and alternate methods of dispute resolution are likewise available, such as negotiation, mediation, and collaborative law. If you don’t have an attorney, now is a great time to schedule a consultation, so that you are ready to move forward with a plan place for protecting yourself during this unprecedented time of upheaval.
Whatever your situation, always keep in mind that you are not alone, and there are many ways to come to a resolution.
