Dividing Assets in a Divorce
When a couple divorces one of the major issues to be resolved is the division of the assets the couple has acquired during the marriage.
Dividing Physical Assets in a Divorce Settlement
The general rule in Florida is that any asset and any liability acquired during the term of the marriage is subject to equitable distribution by the Court. What this means is that if you bought a car during the marriage, it’s a marital asset, regardless of how the car is titled. Same rule is in effect for financial accounts; it does not matter if the account was only listed in one spouse’s name. The money in that account at the time of filing of the divorce action is marital in nature.
Under Florida law, “equitable” presumes “equal” unless there are extraordinary circumstances.
For example, if one of the parties put up a large down payment for a home from their pre-marital assets, then that party could ask the court for an “unequal distribution” to compensation them for the use of non-marital money as the down payment on the home.
Another very important concept with regards to equitable distribution is the co-mingling of marital funds with non-marital funds. Imagine that you have a savings account in your name only that was opened during the marriage. The funds in the account you put acquired during the marriage, which means that (although it is only titled in your name) the account is marital. Now add to the scenario that you inherit $100,000.00 from your father when he dies. You receive the inheritance check, and not knowing better, you deposit it into the marital savings account in your name only.
You have now “co-mingled” marital and non-marital assets, which results in all of the money in that account becoming marital in nature and subject to equitable distribution, even though inheritances are normally excluded from a marital estate.
Obviously, equitable distribution can be a complicated issue, especially when you are dealing with retirement accounts, 401-Ks, inherited assets, stock options, or other investments.
Another consideration the Court will evaluate is whether or not the asset can be divided. When the parties own a parcel of real property that is marital and subject to distribution the Court has two options. The first is to order the property to be sold and for the parties to divide the net seller’s proceeds. The second option is to award the entire asset to one party and then award other assets to the second party to offset the equity the first party received in the house.
Retirement accounts frequently require special orders as well, called Qualified Domestic Relations Orders. These orders are required on 401-Ks and on some pensions and other retirement account in order to divide them up without creating a taxable event for either party.
Contact the Gary Williams Law Firm for Family Law
If you are thinking of a divorce, planning on the issue of equitable distribution issues can be very valuable. Gary Williams, Attorney at The Law Firm For Family Law has been certified by the Florida Bar as an expert in marital and family law, including equitable distribution issues. Call (727) 531-8737 to schedule your free initial consultation to speak with an expert about your divorce.