Divorce is a difficult process, and deciding who gets what during asset distribution can be one of the most challenging parts. It’s important to understand the different types of asset division that may be used in your state and how they could affect the outcome of your divorce settlement. Even in an uncontested divorce in Alabama, it is good to know how this works to feel confident you are agreeing to a fair distribution.
In many states, courts use a concept known as “equitable division” when dividing marital property in divorce. This means that assets and earnings accumulated during marriages are divided fairly but not necessarily equally. The court will consider factors such as length of marriage, income or property brought into the marriage by each spouse, age and health of each spouse, contributions made by either spouse to increase the value of marital assets, and any other relevant factors when making its decision at a trial. If you can reach an agreement and enter into an uncontested divorce prior to anything being filed, then you can get an easy divorce and the judge will enter your agreement. However, it is good to know what a judge would do before deciding whether to agree to something with your spouse.
It’s also important to understand the difference between community property and equitable distribution states. In community property states like California, Arizona, Idaho, Louisiana, Nevada, New Mexico, etc., all assets acquired during a marriage are considered jointly owned by both spouses. This means that all assets acquired during a marriage must be divided equally between both spouses in a divorce settlement.
In equitable distribution states like Alabama, New York, Connecticut, Delaware, Florida, Georgia, Illinois, etc., the court will consider several factors when dividing marital assets in a divorce settlement. These factors include length of marriage; income or property brought into the marriage by each spouse; age and health of each spouse; contributions made by either spouse to increase the value of marital assets; any other relevant factors; and any prenuptial agreements that may exist between spouses.
Some of the key factors considered when dividing marital assets include:
- Length of Marriage: The longer the marriage, the more likely it is that assets will be divided equally.
- Contribution to Marriage: Courts may consider each spouse’s contributions to the marriage when dividing assets. This includes financial contributions, such as income and investments, as well as non-financial contributions, such as caring for children or maintaining the family home.
- Income and Earning Potential: Courts may also consider each spouse’s income and earning potential when dividing assets. This can be particularly relevant if one spouse gave up a career to care for children or support the other spouse’s career.
- Custody of Children: If the couple has children, custody arrangements may impact the division of assets. For example, the custodial parent may be awarded the family home to provide stability for the children.
- Health and Age: Courts may consider the health and age of each spouse when dividing assets. For example, if one spouse has significant medical expenses, they may be awarded a larger share of the assets.
- Tax Implications: It is important to consider the tax implications of asset division. For example, dividing a retirement account may result in tax penalties, while selling a home may result in capital gains taxes.
It’s also important to note that it is illegal for either spouse to hide assets in order to shield them from property division during divorce proceedings. If you do this—and your spouse has managed to uncover evidence—you could face serious legal consequences including fines or even jail time depending on the severity of your actions.
Finally it’s important to remember that while asset division can be complicated it doesn’t have to be an adversarial process if you approach it with respect for both parties involved. Working with an experienced Huntsville divorce attorney can help ensure that you get an equitable outcome from your divorce settlement without having to resort to costly litigation or drawn out negotiations with your ex-spouse.
Attorney Steven A. Harris regularly blogs in the areas of family law, bankruptcy, probate, and real estate closings on this website. Mr. Harris tries to provide informative information to the public in easily digestible formats. Hopefully you enjoyed this article and feel free to supply feedback. We appreciate our readers & love to hear from you!