Alimony isn’t something that most people going through a divorce will look forward to paying. Just knowing that you have to make monthly payments to the ex who you aren’t involved with any longer is difficult. You might be able to avoid having to make those monthly payments if you are able to make a lump sum payment instead.
There are several advantages and disadvantages to making a lump sum alimony payment. One of the most important to some people is knowing that they don’t have that monthly bill hanging over their heads. Since you won’t have to make the payments, you might find that there is more room in your monthly budget to do things that you enjoy.
Another benefit to the lump sum spousal support payment is that you can be done with your ex. Unless you have minor children, you likely won’t have to deal with him or her any longer. Monthly alimony payments are usually dependent upon specific conditions. One of these is that the recipient isn’t remarried or living with a significant other. When you use a lump sum payment for alimony, you don’t have to worry about the relationship status of your ex.
The downside to a single payment is that you have to come up with money all at once. This involves taking a hefty hit because the lump sum payment can’t be less than what the expected monthly payments would have totaled.
You should find out how the tax implications of a lump sum payment might impact you. Other factors might also be present in these cases, so review the circumstances to determine what you need to consider.
Source: FindLaw, “Avoid Alimony Monthly Payment Programs,” accessed Feb. 16, 2018