The court is authorized to effectuate an equitable distribution of all property, acquired by either spouse during the marriage from a source connected with the marriage. Although equitable distribution does not always mean 50/50, the distribution must be equal unless justification of unequal treatment can be shown. A cash payment of for purposes of equitable distribution survives death except in the case where it is for permanent periodic alimony.
1. Marital v. Non-Marital Assets and Liabilities
a. Marital Assets and Liabilities include:
(i) those acquired or incurred by either or by both of the spouses
(iii) interspousal gifts during the marriage;
(iv) all vested and non-vested benefits or funds accrued during the marriage in retirement, pension, profit-sharing, annuity, deferred compensation, and insurance plans and programs. Real and personal property held by the parties as tenants by the entirety
Note: When acquired prior to or during the marriage, is presumed to be a marital asset; one spouse may make a claim for an unequal distribution. Call us to discuss this matter before completing your financial affidavit so we can guide you in determining if an asset is marital or nonmarital.
b. Mortgage Paid with Non-Marital Funds: When a mortgage is paid using marital funds the mortgage payments on the non-marital property the value of the passive appreciation of the non-marital property that accrues during the marriage is marital property subject to equitable distribution.
c. Non-marital Assets and Liabilities include:
(i) those acquired or incurred by either spouse prior to the marriage, and assets acquired and liabilities incurred in exchange for such assets and liabilities;
(ii) assets acquired by either spouse by noninterspousal gift, bequest, devise, or descent, and assets acquired in exchange for such assets;
(iii) income derived from non-marital assets during the marriage, unless the income was used or relied on by the parties as a marital asset (such as comingling separate non-marital funds in joint accounts)
(iv) assets and liabilities excluded from marital assets and liabilities by valid written agreement of the parties, and assets and acquired and liabilities incurred in exchange for such assets and liabilities; and
(v) any liability incurred by forgery or the unauthorized signature of one spouse signing the name of the spouse (such liability will be the non-marital liability of the party committing the forgery or affixing the unauthorized signature)
2. The date for Determining Marital Assets and Value:
The date for determining the marital assets and liabilities is the earliest of:
(i) the date that the parties enter into a valid separation agreement;
(ii) the date specifically provided by a valid separation agreement;
(iii) the date of the filing of the petition of dissolution of marriage;
(iv) such other date that the court determines is just and equitable under the circumstances.
3. Presumptions Regarding Marital Assets and Liabilities: Assets acquired and liabilities incurred by either spouse during the marriage are presumed to be marital assets and liabilities. The presumption may be overcome by a showing that the assets and liabilities are non-marital.
a. Jointly Titled Property: Property titled in both spouses’ names is presumed to be marital property, even if it was originally purchased by one spouse with premarital or non-marital funds. A spouse who purchases such property and seeks unequal distribution in it has the burden of proving that no gift to the other spouse was intended.
4. Retirement Benefits: All vested and non-vested benefits, rights and funds that accrued during the marriage in any retirement, pension, profit-sharing, annuity, deferred compensation, and insurance plans and programs are considered marital assets subject to equitable distribution.
5. Damages Awards: Workers compensation or personal injury damage awards are allowed upon dissolution of a marriage as follows:
(i) Separate Property of Injured Spouse: Noneconomic damages received for pain, suffering, and loss of ability to lead a normal life are the separate property of the injured spouse, as are economic damages occurring after the marriage is terminated.
(ii) Separate Property of Spouse Without Physical Injury: Damages awarded for loss of consortium are the separate property of the spouse who does not supper physical injury.
(iii) Marital Property Subject to Distribution: Damages awards for lost wages or earning capacity during the marriage, and awards for medical expenses paid out of marital funds during the marriage are considered marital property subject to distribution.
B. Factors Considered in Making Equitable Distribution:
a.The contribution to the marriage by each spouse, including the care and education of the children and the services as a homemaker.
b.The economic circumstances of the parties;
c.The duration of the marriage;
d.Interruption of personal career or educational opportunities of either spouse;
e.The contribution of one spouse to the personal career or educational opportunity of the other;
f.The desirability of retaining any asset, including the interest in a business, corporation, or professional practice, intact and free from any claim or interference by the other spouse;
g.The contribution of each spouse to the acquisition or enhancement of marital and non-marital assets, or the incurrence of liabilities for the same;
h.The desirability of retaining the marital home as a residence for any dependent child or any other party, when:
(i) it would be equitable to do so,
(ii)it is in the best interests of the child or that party, and
(iii)it is financially feasible
i. Misconduct of a spouse that depleted marital assets after the filing of the petition or within two years to the filing of the petition; and
j.any other factors necessary to do equity and justice between the parties.
Notes: The court may provide for equitable distribution of marital assets and liabilities without regard to alimony for either spouse. After the determination of equitable distribution, the court must consider whether a judgment for alimony is to be made.
A spouse premarital assets or funds acquired through inheritance are generally not classified as “marital asset” to the extent these assets are not intertwined and co-mingled with marital funds.
If you have questions, concerns, or legal needs regarding the division of marital asset and liability or equitable distribution, please call us at (407) 413-9913 to schedule A FREE CONSULTATION to discuss your legal needs.