Dustin T. Dudley, PLLC

Modification or Termination of Existing Spousal Maintenance (Alimony) in Arizona

In order to modify or terminate an existing, Court ordered obligation to pay spousal maintenance (Alimony), a person is required to file a Petition with the Court under A.R.S. 25-327. Even if a person loses their employment, the existing Court order will continue the spousal maintenance obligation until an appropriate Petition is filed with the Court and the Court approves the Petition. Even if the appropriate Petition is filed with and granted by the Court, the new order will not retroactively eliminate any accumulated arrearage that accumulated prior to the filing of the Petition to modify or terminate the existing Court order. In fact, the non-payment of spousal maintenance is actually classified as a class 1 misdemeanor in accordance with A.R.S. 25-511.01.

In brief, if circumstances change in a way that makes payment of Court ordered spousal maintenance impossible, don’t just stop paying; file a Petition to Modify or Terminate the existing Court order.

RETIREMENT ASSET IN DIVORCE

i. Retirement Accounts

To the extent that retirement benefits (401(K) plans, 403 (b) plans, IRAs, annuities, pensions, and 457 deferred compensation plans, profit sharing plans, ESOP plans, and/or military retirement plans) were accumulated during the marriage, those resources are considered community property and, as such, are subject to equitable (fair, not necessarily, but usually equal) division by the divorce court.

Where such retirement benefits partially pre-date the parties’ marriage, it is necessary to present evidence to demonstrate the pre-marital balance in such accounts in order to have that portion designated as the sole and separate property of the spouse who made the premarital investment.

In cases where both spouses accrued retirement benefits during the marriage, each is entitled to half of the increase of each plan over the course of the marriage.

There are many ways to affect the actual division of such accounts including offsets against other community assets, division orders, Qualified Domestic Relations Orders (QDRO), or simply liquidating the account(s), paying penalties and interest, and dividing the proceeds.

In cases where significant retirement assets exist, it is always advisable to consult with an attorney whose practice is focused upon this area of law to insure you are making a decision that is in your financial best interest. Proper valuation of retirement assets and a determination of which method of division results in the best outcome for your individual situation requires advice from a specialist. You should also consult your tax professional to insure that you understand the tax implications of your choices.

If a QDRO is determined to be the best approach for your situation, neither party’s attorney drafts that document, but rather both parties must either agree on a neutral, third-party attorney whose practice is focused on this area of law or they must ask the Court to appoint one.

For a list of several attorneys whose practices focus on the division of retirement assets and who routinely accept referrals to draft Qualified Domestic Relations Orders, please see my “Useful Links” page.

Spouse Controls The Money. Need Cash To Get Through Divorce?

Both spouses have a legal right to equal possession of any and all community liquid resources. This is true regardless of which spouse has logistical control of a given account. In other words, if one spouse places money earned from work during the marriage into an account in their name only, we can file a Motion for Temporary Orders in a divorce case to gain access to half of those funds. And the Court is required to insure that both parties have equal access to those funds while the divorce is pending. In other words, we can gain access to those funds long before the divorce case is even over.

A.R.S. § 25-315 (H) defines “liquid assets” as: (1) Cash; (2) Traveler’s checks; (3) Cash in financial institutions; and (4) Lottery winnings. A.R.S. § 25-315 (B), indicates, in pertinent part, as follows: “The court shall provide for an order for equal possession of the liquid assets of the marital property that existed as of the date the petition for dissolution or legal separation or annulment was served, unless the court finds that there is good cause not to divide those assets.”

If you are contemplating or going through a divorce, I am here to help.

Dustin T. Dudley, Attorney At Law
(602) 300-6777