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Divorce and Expense Sharing

written by: AlexisW•edited by: Rebecca Scudder•updated: 12/9/2010

There are many expenses during and after a divorce that couples will need to share. Learn more about divorce expense sharing and how it is determined what costs will be split.

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    Divorce and Your Finances

    divorceexpenseshare When you get divorced, you are ending a partnership that was financial as well as emotional. This means that there are many different decisions that must be made regarding how money, assets, debts and expenses are to be handled. One of the major issues that comes up is the question of what expenses are to be shared during the divorce process and after the divorce has become final. Issues of divorce expense sharing may be determined by the two people who are getting the divorce, or they may be determined by the court in the event that the two people are unable to agree.

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    What Expenses Will Be Shared

    The exact nature of the expenses that will be shared varies depending on the specifics of the divorce situation. The two parties to a divorce are free to work out almost any agreement that they would like to work out, if they can actually agree on the terms of the divorce, and the court will sign off on it. This means that a couple can agree to have any expenses shared that they wish. If a court decides issues of expense sharing, however, then things become a little more formulaic in regards to what expenses they may be ordered to split.

    Common examples of shared expenses include:

    • The cost of paying the mortgage on a family home
    • The support of the children, including paying for daycare and other educational and medical expenses
    • The cost of health care

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    Support Payments

    Most commonly, divorce expense sharing takes the form of one spouse being ordered to pay support payments to the other. There are two primary types of support payments that may be ordered. These include:

    • Child support: This is a court ordered mandate that both parents share the expenses for the child. The payment of child support is based on each parent's current income and prospective income, as well as on any special needs of the child. Who has custody is also important in determining child support. The non-custodial parent will have to pay child support to the parent who has sole custody or primary custody to ensure expenses are shared. Parents who share joint custody and who each have the children living with them for a part of the time may not have a child support arrangement, or the payments may be less, since each parent will naturally pay for the child's expenses when the child is in his or her care.
    • Spousal Support: While not ordered in all divorce cases, spousal support may be ordered to provide one spouse with the money to pay for his or her expenses if that spouse's income isn't enough for him to maintain a standard of living similar to that which he enjoyed during the marriage

    These support payments may continue until a child is 18 years old, after which the court may also institute a requirement that the parents share educational expenses. Spousal support payments may be awarded for a temporary basis if the receiver just needs them to help him out while he attempts to increase his income, or they may be awarded on a permanent basis unless or until the receiver remarries.

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    Shared Expenses During a Divorce

    While spousal support and child support deal with how expenses are shared after a divorce, there may also be a need to share expenses during the divorce itself. For example, if the husband moves out of the marital home, he may still need to help pay the cost of the mortgage and of the care of the kids. Since no support agreement or child support agreement will be in place at this time, because the couple is not yet divorced, an expense-sharing arrangement may need to be worked out. This may be especially important in states that require a long waiting period before divorce, such as states where the couple has to live apart for one year or more.

    To resolve the issue of expense sharing during the divorce process before the divorce is finalized, the couple may create a legal separation agreement. This can specify who will pay what, and the court may review it and make it legally binding so the divorce expense sharing arrangement is enforceable by the court.

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    References

    For more information on divorce, see Post Divorce Money Issues