If you and your spouse are getting a divorce, one of the first questions that you’ll need to answer is how your property will be divided.
Marital property is essentially anything that you and your spouse earned during your marriage. It includes things like money, cars, real estate, and retirement accounts.
Identifying Separate Property
When a couple is getting divorced, they will have to decide how to divide their assets. This may seem simple enough, but the laws in your state can make a huge difference in who gets what.
In most states, property acquired during a marriage is considered marital property. This includes everything from a car to your paychecks.
However, there are some exceptions. For example, if a spouse earned income before the marriage or from a retirement account that has not been used to pay for any other item during the marriage, this may be separate property.
A spouse may also claim that a car or other piece of real estate was bought with funds from a prior marriage. This can be tricky to prove, but it is possible.
Separate property can be difficult to identify, especially in community property states, but this does not mean that it is impossible to preserve it. It is a good idea to work with your Denver family lawyer to try and preserve your separate property as much as possible during your divorce.
Assessing the Value of Marital Property
When a couple is divorcing, it can be difficult to agree on how the assets should be divided. This can lead to expensive legal fees and added stress for both parties.
To resolve property issues in a divorce, a judge needs to assess the value of each asset and then divide it equitably, considering all relevant factors. In most states, this is done under the rule of equitable distribution.
It’s important to note that the term “equitable” does not mean equal.
Marital property includes earned income, the marital home and any other property acquired during the marriage.
Non-marital property, on the other hand, is any item that was owned by one spouse before getting married or was received as a gift during the marriage or from a third party.
The court will use these facts to decide how to divide the marital property and allocate its debts and liabilities. It will consider many other things, too, such as the contribution each spouse made to the acquirement, maintenance or increase in value of the property.
Making a List of Assets
A detailed list of your assets can make the process of estate settlement much easier for your executor and loved ones. This list should include both physical and financial assets, such as vehicles, homes, jewelry, antiques, art, business accounts, and retirement plans.
Identifying and listing your assets can be time-consuming. However, it will pay off in the long run.
You should also make sure to list all of your liabilities, such as credit card debts and student loans. These must be apportioned to one or both parties in the divorce.
If you have a large amount of personal property, such as a digital collection of music or videos, you may want to have it appraised by a professional before your divorce. These items can have a surprisingly high value, especially when replacement costs are taken into account.
You can also include miscellaneous assets in your inventory, such as deeded parking spaces and timeshares. These aren’t traditionally considered real estate, but they can still have value and should be listed as part of your overall asset list.
Negotiating a Settlement
When a couple agrees to divorce, it is important to negotiate a settlement before they appear before a judge. This is the only way to ensure that marital property is divided fairly.
Typically, settlement negotiations are conducted through letters and phone calls between the spouses and their attorneys. However, some couples choose to participate in mediation, which is a legal process whereby both parties hire neutral professionals to help resolve the dispute.
Before beginning the negotiation, it is important for both parties to collect accurate balance statements and other financial documents. This can save time and money throughout the negotiation process.
A successful negotiation will result in a final settlement that is acceptable to both parties, and thoroughly addresses any issues that may arise between the parties post-divorce. These issues include spousal support, custody, child support, and property division.
