Iowa Divorce and Family Law

Effect of Trust Assets on Alimony and Equitable Distribution

In the case of In re Marriage of Rhinehart, at issue was the treatment of the wife's future interest in a trust. The court held that the undistributed income from the trust could not be treated as a current source of financial support that would alleviate the wife's need for alimony; the undistributed income from the trust was not a marital asset that was subject to division. The Iowa Supreme Court also held that the wife's future interest in the trust could be considered when determining equitable division of property.

Today's Iowa Court of Appeals Decisions

The Iowa Court of Appeals issued several family law decisions today and are online July 13, 2005 Iowa Court of Appeals Decisionshere

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Military Pension and Compensation Resources

Here are few excellent resources regarding the division, processing, and payment of military retirement benefits and compensation:

1. "The Simple Facts," a summary of the benefits and disadvantages of SBP, briefing slides with text and a trifold brochure, "SBP, Basic Questions Answered," at the SBP section of this Army retirement website.

2. The "Army Benefits ToolArmy Benefits Tool" webpage, applies to all branches of service. It contains explanations for military compensation, pay and entitlements, the Career Status Bonus (CSB), combat zone tax exclusions, SGLI, the Thrift Savings Plan, TRICARE, Combat-Related Special Compensation, USFSPA, Dependency and Indemnity Compensation Rate Tables, and VA benefits.

3. The website for the Army Human Resources Command, contains active duty pay and retirement calculators, TRICARE information, how to earn Reserve retirement points, the value of a point and how to calculate RC (Reserve Component) retired pay based on points. Click on "Links" to quickly navigate the site without the annoying flash-intro.

When is spousal support (alimony) awarded?

This decision from the Iowa Supreme Court provides a good summary of the three types of alimony in Iowa and the factors considered by the court when awarding alimony:

“Alimony ‘is a stipend to a spouse in lieu of the other spouse’s legal obligation for support.’” In re Marriage of Probasco, 676 N.W.2d 179, 184 (Iowa 2004) (citation omitted). Such an award is not an absolute right. And whether it is awarded depends on the circumstances of the particular case. In re Marriage of Spiegel, 553 N.W.2d 309, 319 (Iowa 1996). When deciding to award alimony, the district court must consider the factors in Iowa Code section 598.21(3). In re Marriage of Ask, 551 N.W.2d 643, 645 (Iowa 1996). ...

We recognize three different types of alimony as an appropriate award of spousal support: traditional, rehabilitative, and reimbursement. Probasco, 676 N.W.2d at 184-85. Traditional alimony is “payable for life or so long as a spouse is incapable of self-support . . . .” In re Marriage of Francis, 442 N.W.2d 59, 64 (Iowa 1989). Rehabilitative alimony was conceived as a way of supporting an economically dependent spouse through a limited period of re-education or retraining following divorce, thereby creating incentive and opportunity for that spouse to become self-supporting. Because self-sufficiency is the goal of rehabilitative alimony, the duration of such an award may be limited or extended depending on the realistic needs of the economically dependent spouse, tempered by the goal of facilitating the economic independence of the ex-spouses. Id. at 63-64 (citations omitted).

Reimbursement alimony “is predicated upon economic sacrifices made by one spouse during the marriage that directly enhance the future earning capacity of the other.” Id. at 64. And “[s]imilar to a property award, but based on future earning capacity rather than a division of tangible assets, it should be fixed at the time of the decree.” Id.

The Iowa Code section 598.21(3) factors are:

a. The length of the marriage.
b. The age and physical and emotional health of the parties.
c. The distribution of property made pursuant to subsection 1.
d. The educational level of each party at the time of marriage and at the time the action is commenced.
e. The earning capacity of the party seeking maintenance, including educational background, training, employment skills, work experience, length of absence from the job market, responsibilities for children under either an award of custody or physical care, and the time and expense necessary to acquire sufficient education or training to enable the party to find appropriate employment.
f. The feasibility of the party seeking maintenance becoming self-supporting at a standard of living reasonably comparable to that enjoyed during the marriage, and the length of time necessary to achieve this goal.
g. The tax consequences to each party.
h. Any mutual agreement made by the parties concerning financial or service contributions by one party with the expectation of future reciprocation or compensation by the other party.
i. The provisions of an antenuptial agreement.
j. Other factors the court may determine to be relevant in an individual case.

In re Marriage of Swalley

This decision by the Iowa Court of Appeals is a good primer on alimony and the factors affecting its amount and duration in any particular case. On the subject of property awards, the "key" to whether tax consequences should be considered is whether the sale of an asset is ordered or "otherwise relatively certain." Here, the court found that it was too speculative to predict tax rates 20 years or more in the future to allow an adjustment for tax consequences.

In re Marriage of McKay

Iowa Court of Appeals reduced a "life sentence" alimony award of $3,500 per month to a term of ten years and indicating that a "traditional" alimony award can "accomodate some aspects of rehabilitative or reimbursement alimony." In re Marriage of McKay, No. 3-682 / 02-1457 Decision: 1/28/2004