The National Directory of Certified Public Accountants

Ask A CPA - Divorce & Marriage Issues

Property Settlement From Divorce Settlement - Taxable?

Generally, property settlements "incident to a divorce" are considered tax-free exchanges and are not reportable or taxable. Generally, a transfer is "incident to a divorce" if the transfer occurred within one year after the marriage ceases, or any transfer persuant to a divorce or separation agreement occurring within 6 years of the end of a marriage.

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