DIVORCE, TAXATION, AND STOCK OPTIONS Divorce can be a significant disturbance to a family's financi

In keeping with other aspects of the tax code that give choice to married individuals, Internal Revenue Code (IRC) Section 1041 was enacted to ease the transfer of assets in a divorce by not acknowledging gain or loss. Rather, the code relieves a transfer in the method it deals with gifts. The transferor's tax basis is communicated in addition to the possession to the other partner with minimal direct exposure to taxation. This applies to a lot of divorce-related transfers. A common possession that falls under this kind of transfer, is the individual home. A partner will get the house and the transfer of the title would usually be considered, a tax-free transfer.