Once A Divorce Judgment Is In Effect Spouses Are No Longer Entitled To Employer Health Insurance
Question: “I Am Thinking of Divorcing. When Will I Stop Receiving Health Insurance Through My Spouse’s Work?”
Answer: “After a divorce, the spouse with the family health insurance coverage can no longer cover the other dependent spouse. They are no longer “family” members who can take advantage of the employer-based health insurance policy.”
Question: “Is There A Work Around For Cooperating Spouses Getting Divorced?”
Answer: “Maybe.” If the parties were to seek a legal separation instead of marital dissolution, then the parties marital status would remain–that is they would still be married–but there finances and such would become separated. Then, the spouse who had insurance available through his or her work could continue to use it to cover the other spouse.
This would require cooperation and planning (which are not always present at the end of a marriage). There is also a potential tax benefit of a legal separation. Increases in earned-income credit can make it pay for both spouses to choose “head of household” as a filing status.
There is a six-month waiting period for a divorce. This means that you cannot file as head of household unless you file your divorce prior to June 30. But, you can get a judgment of legal separation fairly quickly as there is no six-month waiting period.
So, if you get a judgment of legal separation you could stay on your ‘spouse’s’ employer related insurance and it might have tax benefits.