Two types of property exist for purposes of property division: separate and marital. All assets and liabilities existing at the end of the marriage will be divided into one of these two categories.
Separate vs. Marital Property
Separate property is property owned by one spouse prior to the marriage, gifts given only to one spouse, and inheritances. The spouse whose separate property it is may keep that property upon termination of the marriage. Marital property is generally all property earned or acquired during the marriage. It may also encompass any increase in value of separate property if it was due to the spouse’s labor or contribution of marital assets. All marital property is divided upon separation.
How do Courts Divide Property?
Courts will divide property equitably, not necessarily equally. When determining how property should be divided courts will consider factors such as:
length of marriage
- amount of separate assets
- financial wrongdoing
- children and their needs
- contributions to professional training
- potential for appreciation
- liquidity of assets
- tax consequences of each piece of property
- debts
Can Property Division be Modified?
Property division is non-modifiable. As such, it is typical to encounter disputes over what is marital versus separate property and the value of said property. In cases where property is difficult to value – i.e. a professional business, a family business, certain executive compensation plans – dividing that property can present challenges.
