Financial Impacts of Divorce Property Division: The Family Home 

While some divorcing couples may have an easier time deciding who should keep the house, it’s not always as cut and dry as it may seem on the surface.
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In every divorce, there are many aspects, financial and otherwise, that spouses must consider as they reach a divorce settlement. The family home is one of them. While some divorcing couples may have an easier time deciding who should keep the house, it’s not always as cut and dry as it may seem on the surface. Many spouses are interested in keeping the family home; however, it’s a significant asset that comes with financial impacts that they each need to consider. Here are the financial factors that every divorcing couple should consider when determining the fate of their family home. 

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Selling the Home 

If neither spouse wants to keep the home, selling it might seem like the best option. Often, if the couple can’t agree on who should get the house, the family court judge will order that it is sold and that the net proceeds are divided equitably. However, selling the home can be problematic for two primary reasons: 

  • Couples who can’t agree on what to do with their home will likely have difficulty determining which realtor to hire, how to price the house, what to fix or replace, negotiating the price, and many other essential details. 
  • Most couples want their divorce finalized as soon as possible, and selling the home can be counterproductive to this goal. The home is not a liquid asset as it can take some time to sell. Selling may be ideal for some couples, but they need to realize that doing so could delay their divorce. A divorce is difficult to finalize when a liquid asset hangs in the balance.  

Capital Gains Taxes 

Capital gains tax liability must always be considered with the financial picture of selling the home. Depending on how recently the couple purchased the house and how long they have lived there, they could face capital gains tax liability as well as a financial loss from the home’s sale. The law allows them to exclude up to $500,000 of gain from tax if you lived in the home for two of the five years before the sale. In some situations, if either spouse serves in the military, it could be extended for as many as ten years. However, if the couple bought the house less than two years ago, the exclusion could be reduced.

The Costs of Maintaining the Home 

One aspect that many couples frequently overlook is the cost of maintaining the family home. Don’t forget that even if a home is brand new, it will eventually need maintenance and repairs. Whoever keeps the home will need to continue with maintenance, which could be quite costly depending on the current state of the house. Getting the family home in a divorce can place an undue and sometimes unexpected financial burden on one spouse. The spouse who wants or agrees to keep the family home will want to seriously consider this financial factor. 

Seek the Advice of a Well-Versed Divorce Attorney 

There are pros and cons to keeping and selling the home. Each spouse should consider them and seek the advice of an experienced divorce attorney and possibly a financial advisor as well. A complete understanding of options will help a divorcing couple make the best decisions for their family moving forward. 


April Jones 2 1In practice for 30 years, April D. Jones is the founder and CEO of the Jones Law Firm, PC. Leading a powerhouse team of practitioners that have helped thousands of families and individuals through high-level family law legal services, Jones was recently awarded the Individual Inclusiveness@Work award by The Center for Legal Inclusiveness (CLI).

Jones leads the Sam Cary Bar Association in a second term as President (2005 and 2021). She obtained her Bachelor of Arts degree from the University of California at Berkeley, and earned a Juris Doctorate from the University of California, Hastings College of Law. Jones is a member of the California State and Colorado State Bars and is a 2021 recipient of the Denver Business Journal “Outstanding Women in Business Award.”

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