Home Page ยป Divorce and Finances

Property Distribution in Divorce

Property division is generally determined based on one of two legal theories: community property or equitable distribution. The way in which each state applies these statutory schemes and the specifics of what is considered "marital property" may vary somewhat from state to state.

Community Property Laws

Community property states work from the principle that marital property should be divided equally in a divorce. These states generally do not take issues like financial need, ability to earn an income, or "fault" into account in dividing marital property.

However, not all property is considered marital property, and the precise definition of marital property may vary from state to state. Generally speaking, marital property includes any property acquired by either spouse during the marriage. In contrast, property acquired by either spouse before the marriage is generally not considered marital property.

Some property acquired during the marriage is also excluded from marital property as it is defined in some states. For instance, some states do not consider property marital property if:

  • It was a gift or inheritance granted to one spouse during the marriage;
  • It was purchased with separate funds acquired by one spouse before the marriage;
  • It was excluded by a valid agreement such as a prenuptial agreement; and
  • It is the result of increased value of separate property acquired before the marriage.

The specific boundaries vary from state to state, and more complex determinations may be required where marital property and separate property have been mingled or where property has been acquired using a combination of marital funds and separate funds.

Equitable Distribution Laws

Equitable distribution laws are much more common than community property laws. Equitable distribution determinations take into account various factors impacting the fairness of the division, which may include:

  • The length of the marriage;
  • The age and physical and emotional health of the parties;
  • The income or property brought to the marriage by each party;
  • The standard of living established during the marriage;
  • Any written agreement made by the parties before or during the marriage concerning property distribution;
  • The economic circumstances of each party at the time the division of property becomes effective;
  • The income and earning capacity of each party;
  • The contribution by each party to the education, training or earning power of the other;
  • The contribution of each party to the acquisition, dissipation, preservation, depreciation or appreciation in the amount or value of the marital property, as well as the contribution of a party as a homemaker;
  • The tax consequences of the proposed distribution to each;
  • The present value of the property;
  • The need of a parent who has physical custody of a child to own or occupy the marital residence and to use or own the household effects;
  • The debts and liabilities of the parties; and
  • Any other factors which the court may deem relevant.

Again, the specific factors considered and weighted most heavily vary from state to state, and to some degree even from courtroom to courtroom within a state.

If you would like to speak to a local divorce attorney about how your property will be treated in a divorce, or if you're ready to file for divorce, we make it easy for you to do so. Simply call our number, 1 (877) 349-1310, and you will be connected with a participating divorce attorney in your area who will schedule an initial consultation with you.