Alimony Guidelines and Formulas

Alimony is a concept under American state law that originated in English common law. It was historically treated as a way to compensate a “wronged” spouse for the breach of the marital “contract.” However, between the 1970s and the 1990s, most states changed their view of alimony to focus on meeting the economically weaker party’s needs, and helping them become self-supporting, rather than focusing on the “fault” of one spouse. Some states began referring to alimony as maintenance or spousal support in connection with this shift. Alimony is usually only an issue in marriages where one spouse has an income significantly higher than the other spouse.

Alimony is distinct from child support, the required contributions by parents for the costs of raising children. Child support is calculated in each state by a statutory formula based on income and custody, and is payable until the child reaches a certain age under state law, making it relatively predictable and easy to estimate. Although a few states have formal statutory guidelines for alimony, most do not, and simply leave it to the judge to decide what is fair or “equitable” in any given case. There are a number of formal and informal guidelines that are used by lawyers and judges to estimate equitable alimony amounts in a given case.

Historically, alimony and child support were treated as income of the recipient for tax purposes, and the payor could claim a tax deduction. Starting in 2019, alimony and child support awards became taxable to the payor, so the payor gets no deduction and must pay taxes on their entire gross income, while the payee does not pay taxes on the support they receive.

This article will apply different alimony formulas to the hypothetical case of “John” and “Mary.” John is a middle manager at a large company with an annual gross income of $200,000. Mary is a teacher with an annual gross income of $50,000. Although their tax burden would vary based on a number of factors, John would pay around $60,000 in taxes and take home around $140,000, while Mary would pay around $10,000 in taxes and take home around $40,000. To keep the calculation simple, we will assume that they have no minor children.

AAML Guidelines

The American Academy of Matrimonial Lawyers (“AAML”) published alimony guidelines in 2007 under which the amount of alimony should generally equal 30% of the payor’s gross income, minus 20% of the payee’s gross income. However, the alimony should not make the payee’s total income more than 40% of the combined gross income of the parties, and the AAML guidelines provide for additional “deviation factors” related to special needs, age, career sacrifices, and other equitable factors. Applying this formula and assuming that none of the deviation factors apply, John would pay 30% of $200,000 ($60,000) minus 20% of $50,000 ($10,000) for a total of $50,000 per year; Mary’s total income would then be $100,000, exactly 40% of the parties’ combined gross income, and John would have a total income of $150,000. Their take-home pay would be around $90,000 each.

AAML guidelines also recommend that the term of alimony be based on the duration of the marriage: 30% for marriages of up to 3 years, 50% for marriages of 3 to 10 years, 75% for marriages of 10 to 20 years, and permanent for marriages of 20 years or more.

The “One-Third Rule”

Another popular and simple alimony formula is to take the couple’s total income, divide it by three, and subtract the payee’s income; in other words, the payee’s income is “grossed up” to one-third of the parties’ combined income. Applying this formula, one-third of John and Mary’s total income would be $83,333, so John would pay Mary $33,333 per year. John would then have a total income of $166,667 (around $107,667 after taxes), and Mary would have a total income of $83,333 (around $73,333 after taxes).

State-Specific Guidelines and Limitations

• California has no formal guidelines on the amount of alimony, but has a statutory guideline that the term of alimony should be one-half the length of the marriage.
• Maryland courts and lawyers often use a complex alimony formula devised by the Kaufmann Center at the University of Maryland. It is generally necessary to use commercial software to apply these guidelines, since they consider factors such as the recipient’s age, income, and education level, and the number and age of their children to suggest an appropriate amount and term of alimony. These guidelines are not “official” and judges are free to ignore them. Maryland case law also allows judges to consider the AAML guidelines when making alimony awards. The Kaufmann guidelines are generally more conservative than AAML guidelines, and will typically result in an award around 60% to 80% of what would be calculated under AAML guidelines. Under the Kaufmann guidelines, the term of alimony is typically limited to 5 to 8 years unless the marriage was for longer than 25 years (in which case permanent alimony may be available). The difference between AAML and Kaufmann guidelines tends to be most stark when the payee spouse is at an upper middle class level. (See: The Divorce Process in Maryland)
• New York refers to alimony as “spousal maintenance” and has a fixed formula for calculating the amount during the pendency of the divorce case. If the payor is also paying child support as a non-custodial parent, maintenance is equal to 20% of the payor’s income minus 25% of the payee’s income. Otherwise, maintenance is equal to 30% of the payor’s income minus 20% of the payee’s income. In either case, temporary maintenance is capped at 40% of the spouses’ combined income minus the payee’s income, and the payor’s income for purposes of the calculation is capped at $192,000. (See: The Divorce Process in New York)
• Texas has some of the most conservative alimony rules in the United States. Alimony is only available in marriages that lasted more than ten years or where the payor was convicted of family violence. For marriages that qualify, alimony is capped at 20% of the payor’s gross income or $5,000 per month (whichever is less), and the maximum term available is five to ten years depending on the length of the marriage.
• Virginia courts and lawyers often follow a formula devised in Fairfax County, which sets alimony at 30% of the payor’s gross income minus 50% of the payee’s gross income. The Fairfax guidelines do not suggest an appropriate duration for alimony. Applying this formula, John would pay 30% of $200,000 ($60,000) minus 50% of $50,000 ($25,000) for a total of $35,000 per year. John would have a total income of $165,000 (around $105,000 after taxes), and Mary would have a total income of $85,000 (around $75,000 after taxes).