In many circumstances, a divorced spouse may experience a change in employment and, with it, a sizable change in income. When that happens, the law may allow a spouse who owes alimony to seek a modification of that alimony obligation. If, however, the supporting spouse has intentionally reduced or ended his earnings, the law allows the court to “impute income” to the supporting spouse, which means viewing his support obligations in light of the salary he was capable of earning, rather than what he actually took in. For one Montgomery County divorced couple, that rule meant imputing significant income to an ex-husband who, according to the courts, spent extravagantly on everything except making his alimony payments.
The case involved the prolonged Maryland divorce litigation of Dennis and Sheri, who divorced in 2010. Even after the final divorce decree, the couple continued to litigate financial issues. One of those issues was alimony. The original arrangement called for the husband to pay the wife $9,000 per month in alimony. At that time, the husband earned a salary bringing in several hundred thousand dollars per year.
A few years later, the husband asked the court to modify his alimony obligation. He argued that he had incurred a significant reduction in income and that this reduction necessitated a reduction in his alimony payments. The trial court ruled against the husband. Instead, the court agreed with the wife that the husband was voluntarily impoverished, and, based upon that voluntary impoverishment, the court was entitled to impute income, which it did to an amount in excess of $300,000. With the husband’s imputed income standing at more than $300,000 per year, the husband lacked a sufficient change of circumstances needed to trigger a modification of his alimony obligation.