How Can an Older Couple Address Home Ownership During a Divorce?

 Posted on December 21, 2021 in Divorce

While divorce can be a complex and difficult matter for any couple, spouses who are over the age of 50 may experience some unique challenges when they choose to end their marriage. Throughout a lengthy relationship, a couple is likely to acquire multiple forms of property, and they may disagree about how these assets should be divided. In many cases, a couple’s family home will be one of their most valuable assets, and both spouses may have emotional attachments to the home. This can lead to contentious disputes about homeownership. During a gray divorce, spouses will need to understand their rights toward their home and other property, the options for addressing ownership of their assets, and the issues that may arise as they work to dissolve their marriage.

Dividing the Marital Home During a Gray Divorce

If an older couple has been married for many years, they may own significant equity in their family home. Since marital assets will include any property acquired during a couple’s marriage, this equity will be considered marital property, even if only one spouse’s name is on the home’s title. All marital assets will need to be divided between the spouses, and each party must receive a fair and equitable share of the marital estate. 

During a divorce, a couple may decide that one spouse will maintain sole ownership of their home, or they may sell the home and divide the proceeds. In some cases, a couple may choose to continue co-owning their home after getting divorced, although this is generally not advisable. 

In cases where one spouse will continue owning and living in the home, they will need to have the other spouse removed from the home’s title. The home’s mortgage will need to be refinanced, and the homeowner spouse will need to make sure they will have the financial resources to make ongoing mortgage payments while also covering other expenses related to the home, including utilities, property taxes, and ongoing maintenance and upkeep. To ensure that all marital assets can be divided fairly, property may be divided in a way that provides the other spouse with assets equal to the value of the equity in the home.

Since sole ownership of a home may not be feasible, selling the family home may be a preferable option for many couples. The money earned from the sale can be divided between the spouses, providing them both with the necessary resources to find new living arrangements. When selling a home, spouses should be aware of the taxes that may apply, including capital gains taxes. When a married couple sells a home, a capital gains tax exclusion of $500,000 will apply. However, if a single person sells a home, they may only claim a $250,000 exclusion. To gain the maximum tax benefits, it is often best to complete the sale of a home prior to finalizing a divorce.

Contact Our St. Charles Property Division Attorneys

If you are over the age of 50, and you are planning to end your marriage, you will want to make sure to properly address issues related to your marital home. At Divorce Over 50 - Goostree Law Group, we can advise you of your rights and options, and we will help you make the most financially beneficial decisions that will allow you to succeed as you move forward following the end of your marriage. Contact our Kane County asset division lawyers today at 630-634-5050 to set up a complimentary consultation.

Source:

https://www.ilga.gov/legislation/ilcs/documents/075000050k503.htm