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Going through a divorce can get messy. One of the messiest topics is dividing up the property and determining who is entitled to what. In this post, we’ll walk through the basics of dividing up property during a divorce.
Two ways to divide property
There are two ways to divide up marital property during a divorce, community property and equitable distribution, and they are determined by the state you live in.
Community property is in effect in eleven state. This means that all property owned by the couple is considered either community property or separate property. Community property is property acquired during the marriage and both spouses names are on the deed or document. Separate property is property is property that was acquired before the marriage and where only one person’s name is on the deed. Community property is divided up evenly, regardless of what kind of property it is. Separate property is kept by the person who is named the owner of the property.
Equitable distribution is used in all other states. Instead of just splitting the property in two, in an equitable distribution, the judge determines what is a fair split between the property. It could be split based on income or on other factors.
Whatever state you are in and whatever method they judge is using, the division is based on the monetary value of the property – not the physical property. For example, if a house was split evenly, it doesn’t mean the one spouse gets the left side of the house and the other the right. It means that each spouse owns a percentage of the value of the house. If they were to sell their home, each spouse would get fifty percent of the profits.
Speaking of the house, how do you know who gets the house you are both living in? Typically, if there are children involved, the spouse that does the majority of the child raising would get to keep the house. If there are no children, then the court will decide based on state rules, who should get the house.
Is all property split in a divorce?
Only marital property is split during a divorce. What is marital property? Marital property is property that the couple acquired together. Wages earned throughout the marriage is considered marital property. Your home, car, boat, vacation home, jewelry, anything that was purchased as a married couple is up for splitting during a divorce. This is true even if only one spouse was working while the other was a stay at home parent.
Nonmarital property is anything that was brought into the marriage by one party. Nonmarital property also includes things that are only in one person’s name such as a trust fund or gift. However, if for example, you take a gift given just to you and put it in your joint bank account, then that gift becomes joint, marital property.
By knowing the laws in your state from a property division lawyer in Austin, TX, you can be prepared for which type of property you and your spouse will be splitting in the divorce.
Thanks to Gray Becker, P.C. for their insight into family law and how property is divided in divorce.