If you're facing divorce, you may be worried about losing more than your fair share of assets to your former spouse. During the course of your marriage, you may have accumulated a home, other real estate, stock investments, valuable collections, and other property that must be divided once you separate. Everything that you and your spouse owned must be split, but whether your assets get divided 50/50 or in another way will largely be determined by the state you live in. Do you live in a community property or equitable division state?
What Is a Community Property State?
In a community property state, a couple's assets get divided 50/50. No matter how spouses contributed to the marriage, each will walk away with an equal share of the marital assets. Courts have imposed community property laws to make asset division easier, but the reality is that these divorces can still be contentious affairs, so this type of arrangement is relatively rare. Only nine states are community property states:
- New Mexico
What Is an Equitable Division State?
If you live in any other state, you and your spouse's assets will be divided equitably. Rather than each person getting 50% of the marital property, a judge will be responsible for seeing that each spouse gets enough to maintain a good quality of living after the divorce so that the asset division process is as fair as possible.
Ideally, the two spouses and their divorce lawyers will negotiate how to divide their property themselves. A judge will then sign off on the decision. If they cannot agree, a judge must step in to make the decisions about how a home, retirement accounts, vehicles, and other assets will be divided.
Are Any Assets Exempt From Division?
Marital property is typically defined as anything acquired by one or both spouses during the duration of the marriage. Separate property, which is not subject to division during divorce, is usually anything the two parties acquired before getting married. For example, a business or home purchased by one person before the couple got married might count as separate property. However, if the couple's shared money was used to care for the home or fund the business, then things get more complicated. Your divorce attorney may help you determine how to divide the increase in value of these assets with your former spouse.
If you have concerns about assets that you might have to split during the divorce, be sure to consult a local divorce attorney. Your attorney can help you receive a fair share of the marital assets.