Highlights

  • Unlike child support, which can be calculated based upon a set formula, there is no single formula or calculation available for determining the appropriateness of a spousal maintenance award in Minnesota.
  • Not surprisingly, because there is no defined method available to calculate spousal maintenance, this is a complex area and requires a great deal of knowledge and competence in negotiating and for final establishment.
  • The factors outlined in this article will play a role in how much you or your spouse might be expected to provide after a Minnesota divorce.

Calculating Spousal Maintenance In Minnesota

In a Minnesota divorce proceeding, the first challenge is to calculate and have a good understanding of four factual aspects:

  1. Husband’s gross income and net monthly income (to be calculated based upon tax filing status after the divorce is completed)
  2. Husbands’ monthly expenses
  3. Wife gross income and net monthly income
  4. Wife monthly expenses

Although this may seem like a straight forward exercise, depending upon each case, this can be a complex inquiry. For example, with respect to income, one party may be self-employed and it may be difficult to calculate net income of spousal maintenance. A party may be voluntarily unemployed or underemployed which means that their potential income must be calculated. In such an instance, a vocational evaluation may be necessary. A spouse may have had an extended absence from employment so it may be necessary to determine the appropriate training/certification/education required for this spouse to become self-supporting.

Monthly expenses also pose unique challenges. First, monthly expenses must be reviewed through the lens of the standard of living established during the marriage. Post separation expenditures or spending do not carry the same weight as expenses which are reasonable and which were incurred by spouses while they were married and living together. Yet another important point, is that spousal maintenance is supposed to be for a spouse – not minor children. Therefore, it is important to carefully delineate the monthly expense of a spouse from that of the minor children. In some instances, it may be necessary to engage an expert to conduct a spending analysis.

Spousal maintenance can be either temporary or permanent. Generally speaking, temporary maintenance or rehabilitated maintenance will have an end date at which time the spousal maintenance obligation would end. However, the recipient of spousal maintenance could potentially ask for an extension of spousal maintenance.

In the case of permanent maintenance, there is no end date but the paying spouse reserves the right to modify/terminate spousal maintenance in the event of a significant change of circumstances. This could be loss of employment, disability, retirement. Similarly, the spouse receiving spousal maintenance may also request modification of spousal maintenance by showing a change in circumstances (increased need, loss of employment, etc.).

Both temporary and permanent spousal maintenance end in the event of remarriage by the party who receives spousal maintenance or death of either party.

Determining whether the spousal maintenance is temporary or permanent is a complex process and requires a great understanding of not only the facts of the specific case, but also an in-depth knowledge and competence of MN laws relating to spousal maintenance.

Factors Affecting Spousal Maintenance in Minnesota

If the specific facts of the case call for a spousal maintenance award, the following factors are critical in determining such an award:

Financial Resources

  • The financial resources of the party seeking maintenance, including marital property apportioned to the party, and the party’s ability to meet needs independently, including the extent to which a provision for support of a child living with the party includes a sum for that party as custodian.

This factor warrants an inquiry into the precise price of marital property that will be awarded to the spouse who is asking for spousal maintenance. For example, it is important to know whether the spouse requesting spousal maintenance is going to be awarded $7 million as part of the marital estate or $250,000. Put another way, what assets are awarded and the value of the assets awarded are very important considerations. In addition, there must be an examination of whether the spouse requesting spousal maintenance can meet his or her needs independently without financial contribution from the soon to be ex-spouse. This is where the income or potential income of a spouse must be analyzed with respect to his or her monthly budget. If the spouse seeking spousal maintenance, can meet his or her needs independently without any additional contribution needed from the other spouse, it is not a spousal maintenance case. Minnesota is not an income equalization state. Minnesota law is geared towards providing for appropriate needs of a spouse.

Time and Skills

  • The time necessary to acquire sufficient education or training to enable the party seeking maintenance to find appropriate employment, and the probability, given the party’s age and skills, of completing education or training and becoming fully or partially self-supporting.

This factor leans on whether or not a spouse needs further education, training or re-training defined employment. A variety of factors have to be considered such as the spouses age (is the person 50 years of age versus 35?), skills (did this person have previous skills that could be leveraged with the aid of further training?). It also must be considered whether the time or the additional training will actually enable the person who is requesting spousal maintenance to become fully or partially self-supporting. In this context, it is not unusual for either side to engage a vocational expert. Such a vocational evaluation attempts to provide a clear picture into the potential employability of a spouse and can also address questions like the time and training required to get to a certain employability level. A vocational evaluation can also assist in aligning the skills and past training with actual jobs that are available in the marketplace by doing a labor study.

Standard of Living

  • The standard of living established during the marriage.

This factor directs the attention of the claimed budgets by either party to the actual and customary expenses that were established during the marriage. For example, if a spouse had an expensive gym membership at Lifetime Fitness, it would be appropriate to include that as a budget item moving forward. If there was a significant history of international travel, it would be reasonable to include such an expectation in the form of a vacation budget moving forward. Sometimes, it can be highly effective to engage with a financial expert who conducts a spending analysis. This could be done by reviewing bank account statements, credit card statements, and any other verification for the applicable period of time to arrive at an accurate budget. For example, a spouse may claim that his or her monthly expenses are $12,000 a month, but a review of the parties spending may establish an amount that is significantly lower than that. Therefore, the key is not to simply state or make up an expense, it is to carefully think through the monthly expenses through the lens of the standard of living which was established during the marriage.

Duration of Marriage

  • The duration of the marriage and, in the case of a homemaker, the length of absence from employment and the extent to which any education, skills, or experience have become outmoded and earning capacity has become permanently diminished.

The longer the length of marriage, the more likely it is a spousal maintenance case. For a spouse who was traditionally a homemaker, it is essential to determine the amount of time that the spouse was unemployed. In addition, it is necessary to determine how the education, skills or experience of that spouse may have become outmoded. For example, a spouse may have been a homemaker and stayed at home for 30 years. In those 30 years, the times would have changed in terms of technology, skills, or general work expectations at a job. It may be highly unlikely for this spouse to obtain a job precisely because his or her education or skills are no longer applicable in the work force.

Loss of Earnings

The loss of earnings, seniority, retirement benefits, and other employment opportunities forgone by the spouse seeking spousal maintenance.

This factor looks back and contemplates the past. The spouse seeking spousal maintenance may have lost earnings (but not for the marriage, the spouse may have been able to work for 20 years), seniority (if the spouse was in the market force, he or she would have been promoted), other employment opportunities (a better job offer in terms of compensation and/or other factors). The duration and amount of spousal maintenance would depend on the answers to these inquiries.

Age and Helath

  • The age, and the physical and emotional condition of the spouse seeking maintenance.

This factor is important to understand because it attempts to link the age (is the spouse 55 or 35?) and any physical or emotional condition with employability. For example, a spouse could be disabled and therefore, unable to work. A spouse may have a diagnosis of mental illness which might significantly hamper the ability of the spouse to remain employed.

Needs of the Counterparty

  • The ability of the spouse from whom maintenance is sought to meet needs while meeting those of the spouse seeking maintenance.

This factor looks at whether or not a spouse can actually afford to pay spousal maintenance. This is done by having a clear understanding of the net income (after taxes) and comparing it with the spouses’ own needs/budget. If this spouse cannot even meet his or her own monthly expenses with their own income, it calls into question the ability of this spouse to pay spousal maintenance. On the other hand, if the spouse from whom maintenance is sought does have the ability to pay, then the question becomes what should be the amount that is justified by the family’s financial circumstances.

Each Party’s Prior Contributions

  • The contribution of each party in the acquisition, preservation, depreciation, or appreciation in the amount or value of the marital property, as well as the contribution of a spouse as a homemaker or in furtherance of the other party’s employment or business.

This factor goes towards the extent to which a spouse who is seeking maintenance contributed as a homemaker or in support of the other spouses’ employment or business. In addition, this factor seeks to examine the contribution of each party during the marriage. Did a spouse spend $250,000 of the marital estate in gambling? If so, the marital estate depreciated directly by the actions of this spouse. Similarly, if a party greatly contributed to the acquisition and the value of the marital property, the spousal maintenance statute does account for that. 

 

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