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FAMILY LAW/DIVORCE
1. How is property
divided?
The division of property
by the Court during a divorce is called equitable
distribution. Property is generally divided on a fifty-fifty
basis. Gifts from your family to you alone or inheritances
are generally exempt and your property alone. Each party
receives a one-half share of any property that was acquired
during the marriage. The same is true for debts, each party
generally receives one-half of any debt that was incurred
during the marriage.
If you owned
property prior to the marriage, it is premarital property
unless you put your new spouse's name on it. For example, if
you owned a home prior to the marriage, it is yours. However,
if you then marry and put your new spouse's name on the deed,
the Court could then consider that a gift from you to your new
spouse of one-half of the value of the property. The same is
true for cars, bank accounts, investments, etc.
Anything
acquired during the marriage is marital property. It does not
matter if they are in one person's name. If your spouse gets a
credit card during the marriage and uses it for marital
purchases, you may be responsible for one-half of the balance
even if you never used it and even if your name is not on the
card. The credit card company will usually hold the person
whose name is on the card responsible but the Court can
require the other person to pay half or all of the card's
balance during a divorce. The same is true for any debt (or
asset).
Anything
bought during the marriage belongs equally to both people
regardless of who paid for it, whose name it is in, or who
uses it. Your spouse never may have worked; never may have
done anything for you, your children, or around the home; and
never may have contributed a dime to any marital asset; and
the Court can still award them one-half of any property
acquired during the marriage.
Retirement account funds
accumulated during the marriage are also marital assets.
Typically (although not always), the amount an account
grows during the marriage is subject to division. Funds can
be paid out of a retirement account to a spouse without
penalty pursuant to a Qualified Domestic Relations Order (“QDRO”).
The Spouse receiving retirement funds in this manner can
choose to deposit them into a retirement account or just pay
the income taxes.
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