Dividing Assets in a Divorce
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How Are Assets Divided in a Divorce?
Divorce is when two married individuals decide that they do not want to be legally bound to each other as a married couple. Once they decide, their joint assets must be divided up in a way that is “equitable and fair.” Assets can refer to cash, property, real or personal, and anything with monetary value. Joint assets are assets obtained during the marriage that both parties have a legal right to.
Assets can be divided in many ways. If the divorce is amicable and not contested, couples often choose mediation as a way of haggling over their joint items. Since mediation can be legally binding, though not always, it is important to understand what kind of mediation you are agreeing to if you choose this route. Some mediators act as a go-between in terms of communication and leave the actual legal documentation to the divorcing couple. While other mediators will come up with an agreement that both members of the couple are legally bound to adhere to. Outside of mediation, assets can be divided during a legal negotiation or during a court hearing in which an order is issued by a judge.
What if my Spouse Lives in a Different State?
Different states can divide married assets differently, depending on whether they follow community property or separate property. Certain states are called community property states while others are known as separate property, or equitable distribution, states. In equitable distribution states, each spouse’s earnings are taken when dividing assets. In community property states, all property is considered community property - equally owned by both partners. Which mode of division your state uses will significantly impact the way assets are divided during the divorce. For example, if one spouse improved a piece of property, then the property would divided by the law of the state the divorce is filed.
To obtain a divorce, there must be legal standing in the state where the divorce is filed. Most states require the married couple to have married there or lived there for a minimum amount of time before granting a divorce. The domicile, or home state, can determine what state law controls in your divorce proceedings. If you and your spouse are living in different states at the time of the divorce or due to the separation agreement, then there may be several possible jurisdictions to file the divorce.
How Do Nuptial Agreements Affect Asset Division During Divorce?
Prenuptial agreements and postnuptial agreements often determine how assets should be split during a divorce. However, these agreements are not always upheld in a divorce. The agreement can be ignored if one spouse: was coerced, abused, lacked knowledge of the other spouse’s assets, or contributed significantly to the other spouse’s earning potential during the time they were married.
Do I Need a Lawyer?
Yes. Divorce law is complex and the stakes are high both financially and emotionally. A divorce lawyer will represent your best interest and help you get the best possible deal.
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Last Modified: 10-14-2016 12:53 PM PDT
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