How Are Marital Assets Distributed in a Montgomery County Divorce?
Distribution of Marital Assets
Whether you are going through a contentious or amicable divorce, it is important to retain the services of an experienced divorce attorney to ensure that you receive your fair share of the assets you and your spouse have accumulated over the duration of your marriage. Otherwise, you may lose out on valuable assets and face financial instability down the line.
Attorney Sheryl R. Rentz is a top Pennsylvania divorce attorney who has the knowledge and resources to help you:
- Discover and identify all marital assets
- Appraise property
- Valuate businesses
- Draw up a fair settlement agreement
If you have questions regarding any legal matter of divorce, please don't hesitate to call the Law Offices of Sheryl R. Rentz, P.C. at (866) 290-9292. We provide free, comprehensive consultations.
What Are Marital Assets?
Generally, marital assets include everything that either you or your spouse earned or acquired during your marriage unless you agreed otherwise through a prenuptial or postnuptial agreement. They can encompass a wide variety of items, including: homes, bank accounts, and other material goods like clothing, furniture, vehicles, and jewelry, as well as any other real estate. Additionally, businesses, partnerships, and companies may have value, but Pennsylvania diminishes the value by a percentage based on good will.
However, there are several items that are considered non-marital assets by Pennsylvania courts. If you acquired assets prior to a divorce, such as family heirlooms or jewelry, then these items cannot be distributed during a divorce. In addition, once you and your spouse have separated, any assets you acquire leading up to the official date of the divorce are considered personal property and are not subject to equitable distribution.
Gifts and inheritance are also not considered marital assets in a Pennsylvania divorce, but there are certain exceptions. If you received a holiday gift from a friend, coworker, or family member other than your spouse, then that item is your sole property. However, if you received a cash gift and deposited it into a joint account that you share with your spouse, those assets may be considered marital assets. In addition, any gifts that were exchanged between spouses are also considered marital assets.
Inheritance is generally considered sole property if the will or trust specified that only you would receive specific funds or materials. If the estate distributed assets to your household, then they will be subject to equitable distribution.
During the Pennsylvania divorce process, dividing up a couple's marital assets can be complicated, regardless of whether the separation was cordial or not. Each state in the United States has their own specific laws about how marital assets should be divided. Unlike some states, Pennsylvania is not a 50/50 state. Instead, it is an "equitable distribution" state, which means that if the parties are unable to reach a settlement, the court will decide what a fair division of the marital assets is. In the U.S., 41 states are equitable distribution states.
What Factors Determine the Distribution of Marital Assets in Pennsylvania?
To decide how the marital assets should be divided, the court will classify which debts, assets, and properties are marital. The court assigns them a monetary value and will then distribute the marital assets equitably between both parties. This does not mean the assets are divided equally, but rather what is decided by the court to be fair. Several factors can affect how the court distributes the marital assets between spouses during a divorce. A few of the factors for determining the division of property in Pennsylvania include:
- How long the marriage lasted;
- Whether there were any prior marriages;
- The income of both parties;
- The health and age of both parties;
- If children are involved, which spouse is responsible to provide for them;
- Whether one party has separate property or assets that are of great value; and
- Whether one spouse committed infidelity or abuse (the courts penalize these offenses).
Unfortunately, sometimes one party may try to hide income or assets, or even allege the other spouse abused or mistreated them in order to receive a better result from a Pennsylvania divorce filing. A family law attorney who has experience with the distribution of assets can help defend your rights to your assets during the divorce process. They can help you receive the maximum amount of assets while following good practices and adhering to ethical standards.
Date of Separation
Montgomery County courts consider couples legally separated the moment they begin living separately. This is referred to as the date of separation, which is important in determining where marital assets begin and end. This does not mean you have to live in separate homes or apartments, though that may be an invaluable sign of separation to the courts. Rather, separation refers to the fact that you no longer consider yourselves a married couple, which may include a lack of a sexual relationship, not attending social functions as a couple, sleeping in separate beds or rooms, separating your finances, changing insurance policies, or refusing to wear wedding rings. Essentially, you and/or your spouse are no longer emotionally or financially contributing to the marriage, demonstrating that it has ended.
The date of separation is not a hard and fast rule in Pennsylvania. Usually, courts accept that a couple is separated when divorce proceedings begin, but they will consider arguments for an earlier date of separation. Your divorce attorney can utilize any of the above signs to demonstrate that your spousal relationship had ended prior to the divorce proceedings. Once this date is established, any property you receive afterward is considered a non-marital asset and is your sole property if you used your own funds to pay for it. If you purchased an item after the date of separation with marital funds, such as a joint bank account, then that item could be considered a marital asset.
Dividing up Marital Debt
While you are determining which assets are marital and non-marital, debt is also an important matter to discuss with your attorney. Marital debt may include shared credit cards, auto loans, mortgages, and any other lines of credit that your household owes payments on. Courts will attempt to assign specific amounts of debt to each spouse rather than splitting it down the middle. Rather than taking on the responsibility for paying for your spouse’s debt and interest, you will want to establish a clear distinction between debt you and your spouse accrued separately.
Any debts you accrued prior to your marriage are your sole responsibility, such as student loans or personal credit card bills. However, even if you weren’t married yet, debts accrued as a part of your wedding can be considered a marital debt. The best option is to pay off all debts prior to a divorce or ensure that specific loans, such as car loans, are in one spouse’s name, specifically the one who is making payments on it and is the primary owner. During the divorce proceedings, your attorney will work with you to clearly establish who is responsible for what debt.
Contact Our Office Today
The Pennsylvania divorce lawyers at the Law Offices of Sheryl R. Rentz, P.C. can help you through this difficult time in your life. Call our office today at (866) 290-9292 for a free consultation and to find out more about how we can help protect your assets during a Pennsylvania divorce.
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