Right to marry debate raises financial issues related to divorce
Just north of Fredericksburg in Washington, D.C., the United States Supreme Court is hearing arguments on the right of homosexual couples to legally marry. Along with the right to marry comes the right to later dissolve that marriage through divorce. However, for married and unmarried couples, regardless of their sexual orientations, separation and divorce can present difficult issues related to the division of assets between the parties.
For example, under current federal tax laws, when unmarried partners split, any transfers of assets between the parties may be subject to income taxes or gift taxes. While supporters of the universal right to marry cite this requirement as discriminatory toward homosexual couples who are unable to marry, supporters of heterosexual-exclusive marriage claim that separate-sex couples who do not marry experience the same tax consequences.
Along with the opportunity to marry comes the opportunity to divorce with no tax consequences. When married couples divorce, transfers of assets are not viewed as taxable events. Therefore, married couples who file for divorce and end their marriages do not have to engage in the same tax discussions as separating unmarried partners. While tax issues are only a small part of the ongoing right-to-marry debate, they represent a significant legal consideration for any parties separating or filing for divorce.
Couples who choose to end their marriages through divorce have to engage in many difficult negotiations to sort out issues ranging from the division of assets, child custody and continuing financial support. While some married couples may rely on agreements executed prior to marriage to help guide them through the difficulties of their divorces, others must confront all aspects of divorce at once.
Depending upon the cause of the divorce and the level of amicability that exists between the parties, some divorces can be resolved in court-approved settlements agreed upon by the parties. For others, a court will hear the parties and determine the best course of action regarding financial, custodial and support decisions. There are many options for people filing for divorce to help ensure that their rights are protected, whether a resolution comes through a settlement or a hearing.
Source: Forbes, "Right To Divorce? Just As Important As Right To Marry (No Kidding)," Robert W. Wood, March 27, 2013