The Live-in Girlfriend’s 

Income & Expenses in Alimony Cases

Unlike child support, North Carolina does not use any Guidelines or formula when deciding what amount alimony should be. Instead, the judge decides whether the low-earning spouse is entitled to alimony, and if so, whether the higher-earning spouse can afford to pay it. All of these decisions are made in the discretion of the judge. If you lined up ten judges to hear the same alimony case, you would very likely have ten different rulings. This is not only frustrating for the parties, but also for attorneys who don’t have the benefit of a crystal ball.

What’s the Deal with Alimony?

By state law, the judge must decide what each person’s income is, and what each person’s reasonable living expenses are. The judge reviews a budget prepared by each party called a financial affidavit, about which each party testifies under oath. The financially dependent spouse must prove more reasonable living expenses than income, which is a financial shortfall. The supporting spouse tries to show expenses and income so as to avoid showing a surplus of money. In other words, the lower-earning spouse wants to show a deficit, and the higher-earning spouse wants to avoid having a surplus of money left over after paying living expenses. A financial surplus is money that can be used for paying alimony.

Frequently, the expenses each party asserts are quite different from what a judge decides is reasonable. For example, a spouse who earns $26,000 per year will likely have a hard time justifying a $700 per month vehicle payment as a reasonable living expense. Courts often expect both parties to tighten their belts after a separation. The judge in that example might think the vehicle could be sold or traded in exchange for a vehicle with a $350 per month payment. In that event, the judge would credit that spouse with $350 as a reasonable vehicle payment.

Why Do I Say The Girlfriend?

Although alimony is payable to husbands or wives, the disparity of incomes almost always means the wife is the dependent spouse in Eastern North Carolina. Usually, the wife seeks alimony, and the husband tries to defend against paying it, or at least tries to lower the amount of it. Based on this assumption, the wife loses alimony if she resides with a boyfriend or remarries. On the other hand, as a supporting spouse, the bare fact that the husband resides with a girlfriend and/or remarries is not important. Because it is almost always a husband paying alimony, we are usually dealing with a live-in girlfriend, which is why I am referencing the girlfriend.

How Does a Girlfriend Impact Alimony?

The circumstances in each case are unique, and each case is based on the finances of the parties. However, in looking at the big picture, there are two main ways that courts can address the live-in-girlfriend in alimony cases. These two methods apply both when the court first rules on alimony, and at any future times if either party files a motion to change the amount of alimony. First, the court can reduce the amount of “reasonable” expenses he can otherwise claim. This frees up the money that he has at his disposal to be applied to alimony. Second, the court can impute income, which means the court can say that he earns more than what he is actually earns or says he earns. In the normal case, courts must decide what the actual income is. But imputing income to someone is serious business. Judges can’t impute income to a spouse unless he is artificially lowering his income in bad faith, either to avoid paying alimony or to pay less alimony than what he should be paying.

What Happens in Real Life?

The court can’t lower expenses based on the girlfriend and impute income to him. The court must use only one of these methods, not both. These two consequences were spelled out in a recent case* in which the husband was living with his girlfriend. His reasonable expenses for the mortgage, homeowner’s insurance, water/trash, cable, laundry/dry cleaning, groceries and eating out totaled $2,832 per month. Because the husband resided with his girlfriend, the court the cut his expenses in half, allowing him to claim only $1,416 per month as reasonable living expenses. The reason for this is that the girlfriend shared in creating those expenses, such as eating out or buying groceries. Therefore, she should be expected to chip-in for her share of those expenses. But the court didn’t stop there, adding (imputing income) an extra $1,416 per month into his income for what the girlfriend should have been paying. The Court of Appeals ruled that the court had improperly used both remedies, lowering expenses and imputing income.

* Walton v. Walton, North Carolina Court of Appeals published December 18, 2018.