Divorce Payout

Forum|Forum|5 years ago
June 18, 2021
3 replies
31 views

Good morning, community,

My client is expecting 33k in a divorce settlement that reflects the equity in the house. Just doublechecking if there is any taxable consequence that might be difference because it is a settlement rather than a sale.

Hope everyone is staying cool, and looking forward to a great weekend,

Dawn

ProSeries Basic

This topic has been closed for replies.

Best answer by abctax55

such as must the dollars must be reinvested into another residence?

Um.. no. That part of the tax code (related to re-investing in another home) went away decades ago.

abctax55

Level 15

The division of marital assets is (generally) NOT a taxable transaction. Splitting the equity in a home isn't taxable.

Be sure, if there are any retirement plans, that the split is handled correctly via QDROs - some attorneys aren't savvy regarding these.

HumanKind... Be Both

SensibleandHourlyAuthor

Level 6

Also, standing six feet away for safety purposes. 😉

Relieved to hear about the home equity. Are there any conditions, such as must the dollars must be reinvested into another residence?

Good note about the QDROS, have one of those going on right now, and you are so right about the reality of attorneys who are not savvy about them.

Thank you,

Dawn

abctax55Answer

Level 15

such as must the dollars must be reinvested into another residence?

Um.. no. That part of the tax code (related to re-investing in another home) went away decades ago.

HumanKind... Be Both

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