How Marital Property Division Works In A Property Settlement Agreement
It is important to understand how marital property division works, including the factors which affect the distributing and distribution of property. Division of marital property is not an easy task as there are many factors to consider. Property division is a major step in the divorce process that takes place in front of the court. When a court divides a couple’s property, as it seems fair this is known as equitable distribution of property. When a court divides a couple’s property 50-50, this is known as community distribution of property. Courts weigh a variety of different factors unequally when deciding how they are going to distribute a couple’s property when using equitable distribution of property. In both forms of property division, the courts believe that both spouses had a hand in bringing property into the marriage with their money. The resolution of property issues between a couple are never easy to perform and can be very unpredictable to come to a property settlement agreement.
Division Of Property
Division of property can be done with an agreement between the two parties, via a property settlement, or by judicial decree. California, Arizona, Idaho, Louisiana, Washington, Texas, Nevada, New Mexico and Wisconsin are all states that divide a couple’s property using the community division of property ideals. These states divide the couple’s property equally among the two parties. All of the other states not listed use equitable distribution of property to divide a couple’s property following a divorce. Property not divided equally among the couple in community states is property acquired prior to the marriage, personal injury awards, inheritances and workers compensation awards even if they were acquired during the marriage.
Divorce Property Distribution Factors
There are ten main factors that factors that must be considered by the courts dividing a couple’s property following a divorce:
- Non-marital property
- Earning power
- Who earned the property
- Services as a homemaker
- Waste and dissipation
- Duration of marriage
- Age and health or parties
- Tax consequences
- Premarital agreements
More marital property might be given to one spouse over the other if one spouse owns more non-marital property than the other spouse. More marital property will be given to the spouse with the lesser amount of property by the court. More money or property could be awarded to a spouse in a divorce that earns less money at work than the other spouse does. The court will give the reason that the spouse with a higher earning power will be able to recover money lost in a divorce more easily than the other spouse will.
Another factor considered by the court when distributing property during a divorce is determining who earned the property. For instance, if the couple owns a family business, the court will award the majority of the interest in the business to one spouse over the other if the one spouse runs the business on his own or her own. If the business has the same value as the family home then the business will be awarded to the spouse that runs it and the home will be awarded to the other spouse so that the court is being fair. Courts consider services as a homemaker as a job for people in a family that care for children and run the household on a daily basis when deciding on property division issues.
Distribution Of Property Considerations
Waste and dissipation refers to one spouse wasting money of the couple during the marriage. This will negatively affect the spouse that wasted the money when the court is deciding how to distribute the property. Wasting money includes gambling losses, spending money on relationships outside the marriage, and money given to family members against the other spouse’s wishes. Fault, specifically non-economic fault, includes spousal abuse. If spousal abuse occurs the court will award more property to the victim of the abuse. The longer a marriage lasts the more likely it is that the court will view the husband and wife as equals, making it easier to give the lesser earning spouse more property. A very sick or old spouse will more than likely receive more property in a divorce because of their situation. A person that has to pay a tax on a piece of property they acquire in a divorce might receive more property to offset the tax payment. A premarital agreement determines how a couple’s property will be divided following a divorce and it is agreed upon by the husband and wife.