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How do you divide your Assets in a Divorce?
Figuring out who gets which assets in a divorce settlement is first determined by separating marital property from separate property, with marital equity being subject to division. The next factor to consider is the laws of the state that you live in, and whether it is a community property or equitable distribution state. In Equitable Distribution states, the property and earnings that have accumulated during the marriage are divided fairly, not necessarily 50/50, between the parties. A court would consider a range of factors when dividing property, which includes, but is not limited to the length of your marriage, amount of income, liabilities, health, whether you have children, etc. In a Community Property state, there is an absolute 50/50 of all property acquired during a marriage regardless of how the asset is titled. Property acquired prior to the marriage remains separate. Within these two categories, property may be classified as either separate property or marital property. Marital property is property specifically accumulated by the couple during the marriage. Separate property is property that is not part of the marriage, but belongs exclusively to either the husband or the wife. Separate property is not subject to division in a divorce, it is retained by the spouse that owned it during the marriage. The distinction between separate and marital property can be easily blurred and is a highly contentious subject. It is entirely possible that separate property can become commingled or transmuted into marital property over the course of a marriage. In order to establish that something is separate property, it must have stayed within exclusive ownership and control of one spouse. This can often be very difficult to prove. If separate property is combined with joint property a court may include that property among the other property divided upon divorce. Providing that you are careful and never commingle your property, it will remain separate property. It is important to note that is takes very little for you to do to “taint” the assets and make them possible candidates for future division if faced with a divorce. If the value of the property you have is substantial, you should consider speaking with an attorney about domestic property protection. Property Protection will protect you from possible future litigation, creditors and spouse’s business partners. Too often many people who have assets spend their lifetime creating wealth but spend little or no time at all protecting their wealth. In the blink of an eye when you least expect it, something you do or are involved in could take it all away.
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