The Various Ways to Divide Property in a Divorce
Robert G. Hetsler, Jr. J.D. CPA
Inspirational Leader, Spiritual Warrior, Life & Business Strategist, Author, Entrepreneur Talks about #Overcoming Adversity, #Leadership through Inspiration, #Belief System, #Success #Importance of Progress
In the perfect world, when a #divorce occurs the spouses would be able to work together to resolve all the outstanding issues in a calm, reasonable and united way. Unfortunately, the world is far from perfect, and many divorces end up with acrimony between the exes.
One area that is often a struggle is how to divvy up the marital property. If the spouses cannot agree, the court eventually will make decisions for them. And while every state has its own laws governing the division of property in a divorce, each state falls into one of two general categories – it is either a community property or equitable distribution state.
Community property states (AZ, CA, ID, LA, NV, NM, TX, WA and WI) treat all property acquired during the marriage as jointly owned by each spouse. In these states, the presumption for division of the marital estate is that each spouse receives an equal share of all marital property. However, any property acquired before the marriage or covered by some sort of pre- or post-nuptial agreement may be excluded from this division.
The other states are considered equitable distribution states. While they may still consider all property acquired during marriage to be equally owned, the division may be different. Instead of requiring a 50/50 division of marital assets, the courts will instead consider the financial needs of each spouse when determining how to divide the property. However, like community property states, any property acquired before marriage (or covered by a pre- or post-nuptial agreement) is usually excluded from the marital estate.
It is interesting to note, however, that if non-marital assets were commingled during the marriage, they may be incorporated into the marital estate if it is impossible to trace them back to their original source.
Going through a divorce can lead to financial uncertainty and concern. Visit our website to learn how a Divorce Transitional Support Advisor can help you or your client regain financial stability after a divorce.