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Protect your alimony with an Alimony and Maintenance Trust

When Denver couples go through divorces, the equitable division of marital property is often a significant issue in the proceedings. Further compounding the difficulties of asset allotment is the fact that, in some cases, parties are unwilling to make their support payments to ex-spouses. For those who believe they may face this problem if they pursue a divorce, it may be wise to proactively protect against such a situation.

One method of guaranteeing that a person cannot simply refuse to make alimony payments is to create an Alimony and Maintenance Trust. These are useful in protecting a payee spouse against lapsed payments by the payor spouse, which can result from a willful refusal to pay or because of a reduction in income. These legal mechanisms, which are also called Section 682 Trusts, are funded with assets from the payor spouse, which will then generate the money that is used to make alimony payments.

Divorce planning that incorporates an Alimony and Maintenance Trust can be very useful and beneficial in some circumstances, but they do carry some consequences, and should therefore probably be discussed with an attorney and tax professional prior to making any legal commitment.

Divorces are rarely pleasant events, and the introduction of asset division and alimony payments can sometimes cause future rifts if parties refuse to make their required payments. For this reason, those who are considering a divorce and believe their ex-spouses may create issues regarding property division and alimony payments may wish to consult with an attorney to discuss precautionary legal options.

Source: Forbes, “How To Get Your Ex-Husband To Honor The Financial Terms Of Your Divorce Settlement,” Jeff Landers, Feb. 19, 2014. 

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