tax on property division

Jennifer Green Burns & Levinson Tax Attorney

Hi there,

I’ve written before about the emotional roller coaster that can come along when it’s time to divide assets during the divorce process.  Today my colleague Jen Green offers the first of several tax rules – and their consequences – for transferring certain property between former spouses.  Stay tuned next week for her assessment of additional tax rules in Part 2.



Dividing the marital property pursuant to a divorce can be quite stressful.  Nevertheless, it is important to understand the tax ramifications when distributing property between the former spouses.   Although most transfers of marital property between former spouses are generally non-taxable, there are some important tax issues that should be understood at the outset in order to avoid any unexpected tax consequences.

To begin with, one must be cognizant of the tax basis in the property received by the former spouse.  Knowing one’s tax basis affects the amount of gain or loss that will be required to be reported when the property received is eventually sold.  In addition, some transferred property, such as the principal home, qualifies for gain exclusion up to a certain threshold amount when the residence is sold.  The transfer of other assets, … Keep reading

Hi there,

It is exciting to see the New England states recognizing the fairness of allowing gay folks to marry. It is a huge step and where people can marry they also inevitably will pay taxes and some of them will later divorce.  In these areas much inequity still remains.

The Defense of Marriage Act (DOMA) impacts the income tax and divorce tax status of gay couples regardless of whether or not they are legally married.

They cannot file federal income taxes as married filing jointly; when, and if, they divorce any transfers of property between them are taxable events, as they are not for heterosexual couples, and there is no deduction for alimony.

All of these are costly, but still it is terrific to have another state recognize gay marriage.


Nancy… Keep reading