Gray divorce involves couples aged 50 and older. People in longer marriages typically face more complex issues when it comes to divorce, particularly with the division of assets and property. Of course, ending a union that lasted decades is also emotionally trying.
While you cannot completely remove stress from the process, you can take steps to reduce it. Kiplinger explains what you can expect when it comes to divorce after 50.
Taxes related to alimony
It is not uncommon for one spouse to pay the other alimony after a gray divorce. In this case, both spouses should understand the tax obligations surrounding such payments. The person receiving the alimony payments must remit taxes for them. And while it was once possible to deduct alimony payments from the taxes of the ex-spouse making payments, recent changes to tax laws mean this is no longer the case.
Separating separate and marital assets is the first step in deciding how any shared assets get split. With longer marriages, determining what is and is not shared is often quite complicated. This is because most couples intermingle their finances, which makes it tough to determine who owns what. In general, shared assets are those acquired during the course of the marriage, while separate assets are those acquired prior to the marriage.
It is not possible to share health insurance provided by a spouse’s employer after divorce. In this case, people aged 65 and older can apply for Medicare to secure health insurance to cover medical needs. If you do not qualify for Medicare, you must seek out an individual insurance policy. You should also consider securing long-term care insurance if you have concerns about the lack of family caregivers.
While complex, gray divorces provide both parties a new start at life. By making the right decisions, you can enjoy a bright and happy future.