A legal separation can not only compromise an individual’s emotional and physical wellbeing, but also potentially change the status of home ownership and other financial aspects. In New Jersey, a legal separation agreement entails a spousal agreement that covers the period between separation and divorce.
Similar to a divorce, a legal separation is a contract outlining child custody and asset division. The difference is that in a legal separation, a couple is still considered legally married. A legally separated couple may choose to follow through with the divorce at a later time. The reasons spouses choose to legally separate instead of divorce range from moral and religious reasons to financial and government benefits. Some individuals believe they may resolve existing issues before reaching the point of divorce.
Additional Reasons for Separation
Many couples choose the legal separation process over divorce for financial reasons. A Forbes article explains in detail why property can make legal separations difficult, and that if a couple buys a home after marriage, the house is considered marital property. Forbes points out that in New Jersey, if the property is marital, then both parties have equal rights to buy-out the other’s share. If both parties make this type of claim, the property is sold with the net realized proceeds of sales divided.
According to lifestyle resource Live About magazine, a legal separation can come with numerous financial benefits. Among the top benefits are tax advantages, in which spousal payments can be claimed as deductions on tax payments, the retaining of certain marital benefits and clearly stated boundaries regarding joint accounts. In addition, a legal separation can protect individuals from being responsible from debt that a spouse may acquire during the period of separation.