Facts: Wife, 58, and Husband, 52, divorced after a long marriage. Wife spent most of the 22-year marriage as a homemaker and primary caregiver, and she last worked in 2007 as a nurse. She allowed her nursing license to lapse and testified that age-related health issues (osteoarthritis, back pain, pre-diabetes) prevent her from returning to work. Husband built a lucrative career, eventually becoming an executive at a large company and earning over $1 million per year.

Two financial experts testified about Husband’s compensation and Wife’s finances. At the time of the divorce, the marital estate was worth about $11 million, which the trial court divided roughly equally. Wife received around $5.5 million in assets, including the $1.6 million marital home, a second rental property, several financial accounts, and half of Husband’s stock and stock-option awards valued at over $1 million. Wife’s only recurring income from these assets was $900 per month in rent from the second property.

After dividing the assets and debts, the trial court turned to alimony. The trial court found Wife economically disadvantaged and that rehabilitation, i.e., restoring her earning capacity, was not feasible given her long absence from the workforce, lack of recent training, and health limitations. It determined Wife had no meaningful earning capacity and declined to find her willfully underemployed.

The court also decided that transitional alimony was inappropriate. Instead, it awarded Wife permanent, long-term alimony. In calculating Wife’s need, the trial court noted Wife’s only income would be the $900 monthly rent. It explicitly stated Wife “should not be required to utilize her division of the marital estate to provide for her current needs, thereby depleting her share of the marital estate.”

After excluding two of Wife’s claimed expenses (charitable donations and retirement contributions), the trial court found Wife needed approximately $13,908 per month. It ordered Husband to pay $14,000 per month in alimony in futuro until Wife’s death, remarriage, or cohabitation with a romantic partner. Husband was also ordered to pay off a home equity line of credit on the marital home from his share of the assets. Each party was left to pay their own remaining attorney’s fees.

Husband appealed the alimony award. First, he argued the trial court erred in finding Wife could not be rehabilitated, i.e., by not imputing any earning capacity to Wife. Second, he contended the trial court failed to consider all income available to Wife from the assets she received in the property division.

On Appeal: The Court of Appeals affirmed that Wife could not be rehabilitated but vacated the alimony award because the trial court did not consider the investment income Wife could generate from her substantial assets.

Tennessee law gives trial courts broad discretion in deciding whether to award alimony and in what amount. However, that discretion must be exercised within statutory guidelines. When setting alimony, a court must consider each spouse’s needs and ability to pay, along with all relevant factors listed in TCA § 36-5-121(i). Those factors include “the relative earning capacity, obligations, needs, and financial resources of each party, including income from pension, profit sharing or retirement plans, and all other sources.”

Thus, the law requires consideration of a dependent spouse’s income from all sources, including investment earnings from assets awarded in the property division. While trial courts need not automatically require an economically disadvantaged spouse to deplete marital assets to cover living expenses, they must at least evaluate the income those assets can generate when determining the appropriate amount of alimony.

Here, Wife’s share of the marital estate included significant liquid assets and investments capable of generating income. Both parties’ experts agreed that Wife’s investments could yield substantial annual returns.

The Court of Appeals found that the trial court erred by treating Wife’s $900 monthly rental income as her only income while disregarding potential investment earnings. Because of this, the Court of Appeals ruled that the alimony award had to be set aside and reconsidered on remand:

From our review of the order, the trial court failed to adequately consider the investment income that both experts testified Wife will have access to as a result of the property division. The trial court found Wife’s earning capacity to be “extremely limited” and that she had “no meaningful relative earning capacity” in comparison to Husband because her only source of income was $900 in rental income. While the evidence supports a finding that Wife’s earning capacity was significantly less than Husband’s substantial earning capacity, the evidence does not support a finding that she had no other sources of income. … [T]he trial court erred in not considering all of Wife’s sources of income.

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In the property division, Wife was awarded $5,496,159 from the marital estate. This included numerous nonliquid assets, including two houses and two vehicles. Wife was also awarded a large amount of financial accounts, including numerous bank accounts; half the value of the Dollar General Account, valued at $1,145,016; all of Husband’s Dollar General 401(k) plan, valued at $1,639,934; a brokerage account valued at $424,297; and two IRA accounts valued at $68,300 and $73,069. Therefore, Wife received significant assets that may generate income or serve as a source of income, and the trial court failed to consider the implications of the property division in its alimony determination.

Indeed, there was no dispute among Wife, [Wife’s expert], and [Husband’s expert] regarding whether Wife could generate income from these assets. A report prepared by [Wife’s expert] estimated that Wife could earn $162,592 per year from an estimated balance of $3,442,960 in investible assets. Similarly, a report prepared by [Husband’s expert] estimated that Wife could have $1,869,715 in investible assets, resulting in $111,459 per year in income. For her part, Wife also testified that she expected to receive income from these assets. … However, there was no dispute that these assets would serve as a source of income for Wife, and the trial court was required to consider them. … It was an error not to adequately consider this source of income.

Because the record did not clearly establish how much income Wife’s investments could or should produce (the experts used different assumptions, and the trial court made no findings on which to credit), the Court of Appeals concluded that it could not fix the error itself. So, it vacated the spousal support award and remanded the issue to the trial court to make the necessary findings and, if appropriate, recalculate alimony.

K.O.’s Comment: If there’s a sizeable marital estate, lawyers and litigants must be prepared to address how much income it can produce. From the paying spouse’s perspective (here, Husband’s), pushing the court to quantify the dependent spouse’s investment income could significantly reduce the monthly alimony obligation. Given the affirmation that Wife truly can’t contribute to her own support, alimony in futuro still seems likely, but it might be set at a lower amount than $14,000 per month once her investment income is taken into account. The trial court has to acknowledge that $5 million+ in investments won’t just sit there earning nothing. So, this case isn’t about whether Wife gets alimony, but how much once her investment income is factored in.

Source: West v. West (Tennessee Court of Appeals, Middle Section, December 22, 2025).

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