What Does a Divorce Agreement Include? A Comprehensive Legal Guide | Attorney Roziel Amir

Divorce Agreement — What Is It and Why Is It Important?

A divorce agreement is a binding legal document that regulates all aspects of the separation between spouses. It is not merely a formal document, but a legal contract that establishes the rights and obligations of both parties for years to come, sometimes for life. While some issues in the agreement are determined by law (such as basic alimony), many terms are set by mutual consent of the parties, which provides flexibility but also carries significant responsibility.

In Israel, a divorce agreement must cover several essential matters to be valid and legal. These matters are not optional — they are a legal obligation. However, beyond these mandatory issues, there are additional matters that should be addressed in the agreement to avoid future disputes. Choosing an experienced attorney to guide you through the agreement process is a critical step — it ensures that you do not overlook any important matter and that your agreement fully protects your rights.

Essential Issues in a Divorce Agreement

Every divorce agreement must contain several basic components. These are the matters that the court will examine and approve, and they form the backbone of the agreement:

• Alimony: A sum of money that one spouse pays to the other, usually on a monthly basis, to support basic living expenses. Alimony can be for the spouse or for children, or for both.
• Child Custody and Visitation Rights: Determining which parent will hold parental rights, where the child will reside, and what the visitation schedule of the other parent will be.
• Division of Joint Property: Allocation of all joint assets — home, bank accounts, vehicle, securities, and joint debts.
• Insurance and Pension Rights: Determining who will inherit from life insurance, who will receive rights in accumulated pension funds, and what will happen to existing insurance policies.
• Children's Name Assignment: Determining the surname of the children following the divorce.

Spousal Support — How It Is Determined and Why It's Important to Arrange in an Agreement

Spousal support (alimony) is a sum of money paid by one spouse to another, or for children, either permanently or for a limited period. In Israel, the Marriage Law establishes basic rules for spousal support, but a divorce agreement allows the parties to agree on an amount different from the standard legal calculation. This is a sensitive and very important matter — inadequate spousal support payments can significantly impact quality of life.

When spousal support is determined in an agreement, it is important to include:

• A clear monthly amount (or other terms such as a percentage of salary).
• A start date and end date (if applicable).
• Update conditions (whether the support will be adjusted if economic circumstances or salary change).
• Method of payment (bank transfer, cash, etc.).
• Instructions regarding future changes (what happens if one party loses a job or experiences a change in financial status).

A common mistake is to leave the spousal support issue vague or with unclear terms. This can lead to payment disputes, payment delays, and even additional legal proceedings. An experienced attorney will help you negotiate spousal support that is fair to both parties while simultaneously protecting you from future claims.

Child Custody and Visitation Rights

Child custody is one of the most sensitive issues in any divorce agreement. It is not merely a legal matter — it is a matter of the child's best interests and parental rights. In the agreement, the following must be determined:

• Sole or joint custody: Who will be the primary person responsible for the child's day-to-day life (home, health, education).
• Visitation rights: How much time per week/month the child will spend with the parent who does not have custody.
• Division of holidays and vacations: How holidays, school vacations, and birthdays will be divided.
• Communication: Each parent's right to speak with the child by phone or other means of communication.
• Education and healthcare expenses: Who pays for private school, medical treatments, and extracurricular activities.

The Family Court in Israel prefers joint custody when possible, as it allows both parents to participate in the child's life. However, in some cases sole custody is the correct solution. The agreement must be clear and specific — it is not enough to write "joint custody" without details. It should include a precise schedule, how major decisions are made, and what happens if there are disagreements.

Asset Division — The Most Complex Economic Issue

Asset division is often the most complex issue in a divorce agreement. In Israel, any property acquired during marriage is considered joint marital property, even if it is registered in the name of only one spouse. This includes a house, apartment, bank accounts, investments, vehicles, jewelry, art collections, businesses, or anything else of economic value.

When dividing property in a divorce agreement, it is important to do so transparently and meticulously. This includes:

• Explicit listing of each asset: It is not sufficient to write "the house will remain with one of the spouses." You must include the exact address, property registration number, current valuation, and any other relevant information.
• Valuations: For high-value assets (houses, businesses), a professional valuation of the property is required. This prevents future disputes.
• Division of mortgages and debts: If there is a mortgage on the house, you must determine who will be responsible for the loan, who will pay the monthly installments, and what will happen if one party cannot pay.
• Division of other debts: Personal loans, credit card debts, debts to suppliers — any shared debt must be allocated to one of the spouses.
• Assets abroad: If there are assets abroad (apartment abroad, foreign bank account), a special clause must be added to address them, as they are subject to different laws.

A common mistake is to agree on asset division in overly general terms, without specific details. This can lead to future disputes when one spouse claims they did not understand the agreement or that some assets were not included. An experienced attorney will help you prepare a complete inventory of all assets, obtain valuations, and ensure that everything is allocated clearly and legally.

Capital Gains Tax and Purchase Tax — Important Tax Matters

When dividing property in a divorce agreement, it is important to know that there may be tax implications. In Israel, when transferring ownership of a property from one person to another during a divorce, there may be a liability for capital gains tax or purchase tax, depending on the circumstances.

• Capital gains tax: If a property has increased in value since its purchase, the difference between the purchase price and the current price is called "appreciation." Generally, capital gains tax is paid when a property is sold. In divorce property division, there are certain tax reliefs, but not always.
• Purchase tax: When purchasing a property, purchase tax is paid (formerly called "registration fee"). In a divorce, there may be an exemption from part of this tax, but this must be planned in the agreement.
• Recent changes: In recent times, the government has changed certain rules regarding taxation in divorces, so it is important to consult with a current attorney or accountant.

In a divorce agreement, you must determine who will be responsible for paying these taxes. This can significantly affect the true value of the asset division.

Additional Matters to Address in the Agreement

Beyond essential matters, there are additional issues that should be thoroughly addressed in the agreement to prevent future disputes:

Health Insurance and Medical Expenses

You must determine who will be responsible for the children's health insurance, who will pay for doctor visits, dental treatments, eyeglasses, and special treatments. This is particularly important when children have special medical needs.

Housing — Who Remains in the Home and Who Leaves

If the house is a shared asset, you must decide who will remain in it after the divorce, for how long, and what will happen to the house in the future (sale, additional mortgage, etc.). This is a sensitive issue especially when there are young children who need stability and security.

Pets

If there are shared pets, you must decide who will care for them, who will pay for veterinary care, and what will happen to the pet if one spouse wants to move it to another city.

Personal Items of Sentimental Value

Money and assets are not the only things that matter. If there are family photographs, letters, mementos, or other items of sentimental value, you should determine how they will be divided. This can prevent emotional conflicts in the future.

Joint Business or Self-Employment Income

If the spouses own a joint business or one of them is self-employed, the agreement should address what will happen to the business, how it will be valued, who will purchase the other spouse's share, and how future income will be divided.

Legal Liability and Insurance

If there are existing or potential legal claims (for example, a claim arising from an accident), you must decide who will be responsible for legal expenses and how any compensation will be divided.

Comparative Table — Different Divorce Agreement Scenarios

Below is a table presenting several different divorce agreement scenarios and how they might appear:

As can be seen from the table, each divorce agreement is unique and depends on the specific circumstances of each couple. No two families are identical, and therefore no two divorce agreements are the same.

Important Tips for Drafting a Divorce Agreement

If you are in the process of a divorce and need to prepare an agreement, here are some important tips:

• Be honest and transparent: All information you share in the agreement must be accurate and transparent. If you conceal assets or income, it could constitute a legal defect and the agreement may be void.
• Obtain professional valuations: For assets of significant value (homes, businesses), obtain a professional valuation of their worth. This prevents future disputes.
• Consider tax implications: Consult with your attorney or accountant regarding the tax consequences of the agreement. This can significantly affect the true value of the asset division.
• Be clear and specific: Do not write overly general provisions. Write exactly what you intend — how much money, when, how, what happens if something changes.
• Consider the children: If there are children, ensure the agreement prioritizes the best interests of the child. Custody and child support should be fair to the children, not just to the parents.
• Review the agreement carefully: Before signing, carefully review the entire agreement. Do not sign something you do not fully understand.
• Keep a copy: After the agreement is approved by the court, keep a secure original copy. This may be important in the future if disputes arise.