If you and your spouse can’t determine the way to divide property and debts during your divorce, the courts will divide your assets under one among two basic schemes: property or equitable distribution. the most difference between property and equitable distribution is that in property states, there’s an absolute 50-50 split of all property acquired throughout the whole union . In equitable distribution states, more assets could also be considered “marital property,” but the split isn’t necessarily 50-50.
Community Property
There are nine property states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico , Texas, Washington, and Wisconsin. In these states, all property of a spouse is assessed as either property (owned jointly by both spouses) or the separate property of 1 spouse. Marital property refers generally to all or any of the property acquired by either or both spouses during the wedding . Separate property refers to any property the spouses acquired separately before the wedding or after separation (or in some states after divorce). Separate property also includes any gifts or inheritances acquired by either spouse at any time. There are exceptions to those general rules, which are spelled call at each US state laws.
At divorce, property is usually divided equally between the spouses, while each spouse keeps his or her separate property.
Couples in Alaska can opt in to a property system just like the one described above. In South Dakota and Tennessee, spouses can opt in to a modified property approach by transferring specific assets or property into a legitimate property trust.
Equitable Distribution
In the remaining states, including New York, NYC Laws states that assets and earnings accumulated during marriage are divided equitably (fairly), but not necessarily equally. In a number of those states, the judge may order one party to use separate property to form the settlement fair to both spouses.
What sometimes makes this confusing is that division of property doesn’t necessarily mean a physical division. A court may award each spouse a percentage of the entire value of the property. therein event, each spouse will get personal estate , assets, and debts whose worth adds up to an assigned percentage. Note that it’s illegal for either spouse to cover assets so as to shield them from property division, and if you are doing this, a court could punish you with sanctions and in some states, by awarding a percentage of the worth of the hidden asset to your spouse. In California, if you intentionally and fraudulently hide an asset from your spouse during the divorce, a court could award 100% of that asset to your spouse as a punishment.
Leave nothing to the law of assumption, always ensure you know which state you got married and the applicable property division laws during divorce.
