Division of marital property and debt can be very complex with many legal pitfalls. The first step is to determine whether there is an existing pre-nuptial or post-nuptial agreement and whether that agreement is valid. The second step is to determine which assets are included in the marital estate. Some property owned before the marriage, such as inheritances or business revenue, may be separate property. However, some property may have been commingled to the point that what was once non-marital property has become marital property that must be accounted for in the division of marital property.
Separate Property Versus Marital Property
Generally, what you owned before the marriage is considered separate property unless you commingled it with marital assets. Separate property may be awarded if the other spouse contributed to it or if the invasion of separate assets is necessary for the support of the other party. Gifts that each spouse received during the marriage, including inheritances, may be considered separate property if they were not commingled or otherwise shared. Your attorney will help you analyze the marital estate to determine the best course of action.
Gifts that each spouse received during the marriage, including inheritances, may be considered separate property if they were not commingled or otherwise shared.
Equitable Distribution of Assets
Courts consider a number of factors when deciding how to divide property in a divorce including the length of the marriage, age and health of the parties, and the ability of each spouse to support themselves after the divorce. In the case of business property or parties with extensive assets, valuations can be complicated. Financial experts, such as tax attorneys, CPAs and economists may needed to provide opinions regarding the value of the assets.
Business property division is always a complex part of a divorce. Many times, the parties have to aggressively litigate business property division. When a professional practice is part of the property at stake, it is all the more important to have a skilled attorney with business valuation experience.
There are several methods for determining the value of a business. However, the common elements in all methods is determining a fair market value for the services provided by the business owner. For the purposes of equitable distribution, the number calculated for the business valuation is subject to division between the spouses.
One concern of spouses who are primary owners of a business and have to pay spousal support is "double dipping." This occurs when a non-owner spouse receives a share of the business is also attempting to collect alimony from the income generated from the other spouse's share of the business. We have the experience to fully analyze this potential double dipping issue and make sure you are getting a fair deal.
Division of Retirement Accounts
Pensions, IRAs, 401(k)s and other retirement vehicles are divisible upon divorce. This requires very specific documents called Qualified Domestic Relations Orders (QDROS). QDROS must be specially drafted to ensure accurate division and distribution of these assets, as well as acceptance by the Plan Administrator. If these documents are not drafted correctly, the consequences can be significant and may impact your own retirement plans.