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ScottyMacEsq
ScottyMacEsq, Lawyer
Category: Family Law
Satisfied Customers: 15911
Experience:  Licensed Texas General Practice Attorney
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I have been divorced years. I live in florida. My exhusband

Customer Question

I have been divorced for five years. I live in florida. My exhusband has been paying montly alimony which will discontinue in 4 1/2 years A financial advisor suggested that the rest of the alimony be put in trust, which would amount to about 500 thousand. I cannot explain this in detail however, I was told that it would help me save on taxes and my ex would benefit and save money on the deal of course the divorce agreement I would need altering. last year it was altered to include a minor change to include his girlfriend in the event of his death....hope I made this somewhat clear....
Submitted: 1 year ago.
Category: Family Law
Expert:  ScottyMacEsq replied 1 year ago.

Thank you for using JustAnswer.

Yes, it is possible. This is called a "alimony and maintenance trust" (aka a "682" trust because of the citation to the law).

An Alimony and Maintenance Trust has a number of benefits. For instance, an Alimony and Maintenance Trust:

  • protects the ex-wife from the death or financial insolvency/bankruptcy of the ex-husband prior to the payment of all alimony.
  • can be administered by a neutral third-party professional trustee (such as a bank), who can act as an intermediary between the former spouses (especially important if the former spouses have a very contentious relationship).
  • can have lasting benefits for children. After the ex-wife has received the amount of alimony for the period of time indicated in the divorce or separation agreement, or after her death, the income of the trust can either continue for the benefit of the ex-spouse’s children or the trust assets can revert back to the ex-husband to do with as he pleases.

Code Section 682 provides that the transferee spouse is taxed as a trust beneficiary, and not as the recipient of alimony, on the amount of any trust income that the transferee spouse is entitled to receive.

So there are tax benefits, if you don't need as much income in one year, etc... and it's certainly beneficial to get that out of his hands if you think that the money is not necessarily secure (again, bankruptcy, death, etc...).

Hope that clears things up a bit. If you have any other questions, please let me know. If not, and you have not yet, please rate my answer AND press the "submit" button, if applicable. Please note that I don't get any credit for the time and effort that I spent on this answer unless and until you rate it positively (3 or more stars). Thank you, ***** ***** luck to you!

Expert:  ScottyMacEsq replied 1 year ago.

Did you have any other questions before you rate this answer?

Expert:  ScottyMacEsq replied 1 year ago.

Are you there? Please note that I am still here, awaiting your response or rating... (please note that rating closes this question out, so if there's nothing else, please rate it so that I can assist other customers that are waiting for answers to their questions)

Expert:  ScottyMacEsq replied 1 year ago.

Should I continue to await your response, or may I assist the other customers that are waiting?

Expert:  ScottyMacEsq replied 1 year ago.

I see that you have not responded in some time. Please note that this question is still open until you rate it. I believe that I have answered your question, but if you have any other questions, please let me know.If not, and you have not yet, please rate my answer. Please note that I don't get any credit for my answer unless and until you rate it a 3, 4, 5 (good or better). Thank you, ***** ***** good luck to you!

Expert:  ScottyMacEsq replied 1 year ago.

Did you have any other questions before you rate this answer?

Expert:  ScottyMacEsq replied 1 year ago.

I see that you still have not responded in some time. Please note that this question is still open until you rate it. I believe that I have answered your question, but if you have any other questions, please let me know.If not, and you have not yet, please rate my answer. Please note that I don't get any credit for my answer unless and until you rate it a 3, 4, 5 (good or better). Thank you, ***** ***** good luck to you!