I sold my small business a few months ago that resulted in a much larger than average income for this past year. I’m intending to retire off of that sale.
My income going forward will likely be minimal, so how is alimony determined given that I am about to retire off profits I made through my business?
This answer only includes general divorce help for men since I am only licensed to practice in Oklahoma and am thus unable to provide financial advice on divorce based on the laws in your state.
In most jurisdictions, alimony is based on a showing of a need for support and an ability to pay. Your wife will have to show that she has a need for support, but she will also have to show that you have the ability to pay that support.
If you had a nice income before your recent retirement and you have had a big influx of funds due to the sale of your business, you can expect that your wife will argue that your ability to pay should be based on your past earnings and your potential to continue to earn well.
On the other hand, you will need to show that you expect your income to drop substantially, and that your impending retirement should also be considered when determining your ability to pay.
Another important factor to consider is the nature of the business interest you sold with regard to your marital estate. If you purchased your business during your marriage or used marital funds to establish your business, the interest that you sold could be considered a marital asset. If it is a marital asset, it would likely be equitably divided as property in your divorce.
In most jurisdictions, if your wife is awarded a portion of the money generated by the sale of your business as property division in your divorce, she cannot then consider that same money as a source of income when determining your alimony obligation. This is called “double dipping.”
Alimony can be a very tricky subject and it is important that you seek the advice of a skilled mens divorce attorney before addressing any alimony issues presented by your divorce.