Who Gets to Keep the Vacation Home After Your Divorce?


When a couple has children, whoever has primary custody of the children usually gets awarded the marital home after a contested divorce in Pasadena. Unfortunately, the division of a vacation home isn’t as clear cut.

If you want to keep the vacation home after your divorce, you must provide your spouse with assets of equivalent value. You will also need to remove your spouse’s name from the title and refinance the mortgage in order to release him or her from further responsibility for payments on the property.

If you want to sell the vacation home, you must take into account the fact that capital gains exclusions go away when you're talking about the value gained from the sale of a vacation home. If you and your spouse purchased a $300,000 home that has risen to $400,000 in value at the time of your divorce, taxes will be due on the $100,000 in capital gains when you sell the property. The capital gains tax exclusion of $250,000 for single filers and $500,000 for people filing a joint return only applies to the sale of a primary residence.

California’s community property laws apply to the division of your vacation home even if the property is located in a different state. However, the issue gets a little more complicated if your property lies outside the United States. Some countries have laws regarding money from the sale of property leaving the country, so you might have trouble getting your funds if you are able to sell the vacation home successfully. There are also countries that won’t work with you to enforce the terms of your divorce decree, which can be problematic if the home was awarded to you, and your spouse isn't voluntarily forfeiting his or her rights to the property. You will need to discuss this issue further with your attorney to figure out the best way to proceed.

How Can We Help?

Please call our office at (626) 683-8113 or email us at info@PasadenaLawOffice.com if you are in need of divorce help in Pasadena. Our family law firm can assist you with issues relating to the distribution of vacation homes and other marital assets.