Consideration of Exempt Assets When Modifying Alimony Awards

An existing alimony award can be modified after the entry of the Final Judgment for Divorce if either party experiences a significant change in circumstances that warrants a modification of the alimony award. 

After a court determines that a change of circumstances has occurred, the court must determine the amount that the alimony award should be  either increased or decreased. As part of the court’s analysis, it will consider will consider the income and earning capacity of the parties. 

One important consideration will be how each parties’ financial assets that were exempt from equitable distribution are considered among other financial factors.

When a party has significant exempt assets that were either distributed to them in the divorce or acquired after a divorce, the existence of these assets can affect the modification of an alimony award. 

Consider if a supported spouse receives millions of dollars from the lottery or an inheritance. A court may consider the new availability of this significant windfall or make the other party’s continuing alimony payments no longer justified.

In many cases a court will consider the amount of income that could be generated by reasonably investing the assets. The imputed investment income income will then be added to the party’s employment income and other forms of income to determine how the receipt of these assets affects the party’s lifestyle and the equities of the alimony award.

The attorneys at Ulrichsen Rosen & Freed LLC have experience addressing the nuances of how courts are likely to treat each party’s assets when modifying alimony awards and obligations. If you have questions about exempt assets, alimony or any other family law related issue, please contact the attorneys of Ulrichsen Rosen & Freed LLC. Our firm is focused exclusively on the practice of family law and serves clients throughout New Jersey including clients residing in Mercer County, Somerset County, Hunterdon County, Burlington County and Middlesex County.The attorneys at Ulrichsen Rosen & Freed LLC.