The answer could very well be yes — for obvious tax reasons. Now we’re not saying, though, that taxes will benefit the buyer in this case. Rather, this will be a mutual benefit in selling the home during a divorce, and here’s why:
Being Free and Clear of the Obligations
The situation has to fit; we’ll say that much. As there are plenty of divorce tax options regarding the home to choose from.
Let’s say you want to keep the house. Your ex-spouse understands that and has no problems leaving except for the fact that you’re going to have to pay up some money to own the house solely on your own. In essence, you’re buying off your ex-spouse by paying his/her share of the ownership.
Tax reasons in this situation require some negotiation, though — a fair price has to be agreed upon by both parties, and once both sign on the dotted line, the one selling the share of the home gets that name removed off the deed. On the one hand, if you’re buying, you’re paying up extra money; however, guess what: that property’s all yours. On the other hand, if you’re selling, you’re getting some money in your pocket; this does mean, though, you absolutely have to move out.
Now keep in mind that negotiations don’t necessarily have to end up clear across the middle. Oftentimes divorced couples will negotiate on a buyout price that reflects the income. It’s a fair price; not an equitable one.
You Benefit Through Tax Reasons in This Way….
As in, you don’t pay any taxes as a result of the buyout, saving you some tax trouble down the road. Of course, the negotiations can require some legal planning, which you can sign up for right here; and, of course, you’re going to want to consult with an expert from the Income Tax Planning Network immediately.
Don’t hesitate. Do it now. That divorce shouldn’t have to drag out too much.