One of the realities of divorce is separating marital and non-marital property. This is also one of the reasons many divorces take forever to settle and both parties often leave the table with some feelings of animosity. It is very important going into divorce proceedings with a full understanding of what you can and cannot make claim to in the settlement.
Some of the most common assets divided during a divorce are:
- Retirement plans
- Bank accounts
- Investment accounts
Before getting into a dispute over these assets, you need to understand what is considered marital property and what belongs to one of the parties outright.
Every state will have its own specific guidelines for what is and what is not considered marital property, so we will use generalities here that are common to most states. Before you put together your “list,” however, we recommend sitting down with a local divorce attorney to ensure your items are in fact categorized properly.
Generally, assets that were obtained prior to your wedding are considered non-marital property. However, if these assets were contributed to and/or improved upon as part of that union, your spouse may have a partial claim to these assets. For instance, a retirement account that was in place prior to the marriage and still contributed to after the marriage will fall into both categories. Both funds contributed and earnings during the period of the marriage can be claimed as a joint asset by your divorcing spouse and become part of the divorce settlement.
Marital property is much easier to categorize, as this is any asset obtained during the course of the marriage excluding “gifts” given specifically to one spouse (however, in some states, even these assets may be considered joint property). These assets are usually split evenly, but the couple may agree to terms to allow one spouse to keep an asset in its entirety in lieu of giving up another asset (for instance, a husband gives his wife the house outright in exchange for keeping full claim to his 401k).
Separating marital and non-marital property in a divorce can be very difficult and time consuming. Emotions often come into play and make a bad situation even worse. A divorce attorney can help make the process easier by negotiating on your behalf with your spouse’s attorney to keep emotions out of the equation.