Transfer Incident to Divorce
A transfer incident to divorce is a transfer of property between spouses that is connected to the divorce, which the IRS generally treats as tax-free at the time of the transfer. In a Florida dissolution, this lets one spouse give the other an asset—such as a home, brokerage account, or retirement funds—without triggering immediate income tax. The receiving spouse usually takes over the original cost basis, so taxes may apply later when the asset is sold. This concept matters in equitable distribution, where Florida courts and agreements divide marital property.
Last updated June 21, 2026
Legal Definition
A property transfer between spouses, or former spouses if incident to the divorce, that under IRC §1041 is treated as a non-taxable event with carryover basis; it commonly implements Florida equitable distribution under F.S. §61.075.
Example
The brokerage account moved to her as a transfer incident to divorce, so no tax was due until she later sold the shares.
Related Statutes
- 61.075
Related Terms
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