Changes have been made to both Virginia and federal law that have substantial implications for spousal support in Virginia.
BIG CHANGES FOR DIVORCING COUPLES
What does silence about the modifiability of spousal support in a divorce settlement agreement mean?
If divorcing spouses settle their case and sign a Marital Settlement Agreement, spousal support can be considered either modifiable or non-modifiable. Prior to a 2018 change in Virginia law, if the Agreement specified that spousal support could be modified, then it could if a petitioning party met the modification standard detailed in the Agreement. If the Agreement was silent about spousal support modification, spousal support could not be modified by a court, even if there were a change in circumstances, unless the parties agreed to the change. In other words, previously, silence meant spousal was non-modifiable.
With the new Virginia law, in order for spousal support to be non-modifiable by a court, the wording of a Marital Settlement Agreement must be specific as to non-modifiablity. So now, silence means spousal is modifiable. This is detailed in Virginia Code § 20-109 (C), which says:
No request for modification of spousal support based on a material change in circumstances or the terms of stipulation or contract shall be denied solely on the basis of the terms of any stipulation or contract that is executed on or after July 1, 2018, unless such stipulation or contract contains the following language: “The amount or duration of spousal support contained in this [AGREEMENT] is not modifiable except as specifically set forth in this [AGREEMENT].”
What does retirement mean with respect to spousal support?
Under Virginia law, absent an agreement between the parties otherwise, a party seeking a spousal support modification must prove a “material change in circumstances justifying a change.” Prior to the 2018 change in Virginia law, the retirement of a party (the payor or the payee) was not necessarily considered a material change in circumstances. Now, if a party has reached maximum social security age as defined by federal law, which is currently age 67, retirement would constitute a material change of circumstance. This change is significant because it allows a retiring party to at least get their day in court—a petitioning party would still have be able to show that the change in circumstances (i.e. their retirement) justifies a change in support.
Additionally, with the new law, if a party files for a modification of spousal support due to retirement, the court must now take into account an additional six factors that relate directly to retirement in order to determine if a change of support is justified. According to Virginia Code §20-109.1(F), these six factors include:
- Whether the retirement was contemplated by the court and specifically considered by the court when the spousal support was awarded
- Whether the retirement is mandatory or voluntary, and the terms and conditions related to such retirement
- Whether the retirement would result in a change in the income of the payor or the payee spouse
- The age and health of the parties
- The duration and amount of support already paid
- The assets or property interest of each of the parties during the period from the date of the support order and up to the date of the hearing on modification or termination
Normally, a substantive change in the law is applicable only prospectively to actions filed on or after the effective date of the bill, which in this case would be July 1, 2018; however, Virginia Code § 20-109(F) indicates it shall apply to all suits for modification or termination of spousal support “regardless of the date of the suit for initial setting of support or the date of the entry of any such order or decree.”
Taxes and Spousal Support
Pursuant to 2017’s federal Tax Cuts and Jobs Act (“TCJA”), in cases where a divorce is entered after December 31, 2018, payor spouses will no longer be able to deduct alimony from their taxes, and alimony will no longer be considered income to payee spouses. It is recommended you discuss with your lawyer how this change will impact the spousal support you pay or receive.
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