Second only to resolving matters involving minor children of the marriage, the division of the property and debt of a marriage are the most critical issues to resolve in a divorce. Florida is an “equitable distribution” state, which sounds like each spouse is entitled to 50 percent of the assets and is responsible for 50 percent of the debt of the marriage. Sounds simple enough, right? Not exactly. There are many factors and considerations which may impact the allocation of assets and liabilities of property during and after a divorce. This includes, but is not limited to, a determination as to whether the property or debt in question is marital property or non-marital property.
Marital property is a legal term that refers to assets and debts acquired during the marriage, regardless of how the property is titled or who incurred the debt. An example would be the purchase of a car during a marriage, is titled in only one name, remains an asset or debt of both spouses during a divorce proceeding. Or, if one spouse runs up credit card debt in their name, it is still the responsibility of both to pay off the debt. However, the court does take into consideration a spouse that is spending recklessly in anticipation of a divorce. Assets and debts become complicated if there was property or business acquired prior to marriage and the value of the property or business was enhanced during the time of the marriage. This can occur, either through the addition of marital funds or the work of both spouses. Other examples of marital property includes the earnings of both spouses, bank accounts, retirement and investment accounts.
Non-marital property is that which is protected from your spouse’s settlement in a divorce decree. Property owned or acquired prior to marriage is considered separate property and can be excluded from a divorce settlement. An example would be the purchase of a house prior to marriage. This would not be included in the division of assets unless the value has been enhanced during the marriage. Inheritances and gifts made by persons other than your spouse during the marriage are considered non-marital assets. Debts accrued prior to the marriage are exempt from equitable distribution as well.
Equitable distribution in a divorce is subject to the court’s perspective on what is fair and just for both parties. Some of the factors that are considered are the length of the marriage, the earnings of each spouse and any health or medical issues of both parties. Consideration is also given to a spouse that had primary responsibility for the children, the desirability to maintain the marital home as a residence for dependent children, pre-nuptial or postnuptial agreements and the interruption of a career or education due to responsibilities of the marriage.
The prospect of divorce is devastating on many levels and the division of property and debts further intensifies these emotions. If you are considering divorce it is likely that you have any concerns about the division of property and associated liabilities. Let us be your advocate during this tumultuous time. Contact our office today to schedule a consultation.
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