Understanding: How to Divide Assets in a Pensacola Divorce
When a Florida marriage ends, you would think that dividing up property and debt between the divorcing spouses would be a relatively easy task, but that is not necessarily the case.
While state law calls for equitable division of marital property, what that actually means can be a complicated question, especially for a long-term or high-asset marriage during which the spouses may have accumulated a complex combination of property, money, investments, real estate and, on the other side of the coin, liabilities, and debts. Only an experienced family attorney will be able to guide you through this maze.
Why You Should Avail the Services of a Pensacola Family Law Lawyer
Any Floridian facing divorce should speak with an experienced family lawyer to understand how a state court judge is likely to approach property division in the particular marriage if the issue comes before the court. With that understanding as a backdrop, the parties will often negotiate a settlement agreement themselves that includes the terms of property and debt division.
(Property division can also be impacted in divorce if it was dealt with earlier in a valid premarital, also known as a prenuptial agreement or prenup for short, or a postmarital agreement between the parties.)
If the parties do not settle the question in negotiation and the issue ends up before the judge, he or she has to apply state law, which will be summarized here.
Marital versus nonmarital property
The first crucial question is the classification under Florida law of each asset and each debt as marital or nonmarital. Marital property and liabilities are those incurred during the marriage, by either spouse alone or jointly, including wages earned by either while married, even if they were deposited into an account that was not jointly owned.
Broadly, marital property and debt are subject to equitable distribution, which means equally divided unless unequal distribution is justified considering all factors relevant to create equity and justice between the parties, including specific things listed in the statute like contributions to the marriage like care of children and homemaking, marriage duration, recent destruction of assets and others.
Nonmarital property and debts that belong to just one spouse will be assigned to that person alone to keep after the divorce is final. These are defined as those acquired by a person before marriage or received separately as a gift or inheritance (or exchanged for such assets).
Sounds simple enough, but in practice, property classification can become a highly contested issue, because the law and cases interpreting it are complicated and full of exceptions.
For example, nonmarital funds or income from a nonmarital asset generated during the marriage usually stays nonmarital, unless it was treated as a marital asset, such as by depositing it into a joint account with other marital funds and using the commingled funds for marital expenditures. In this situation, the court may consider the deposited nonmarital asset to have been an interspousal gift that changed its classification to marital.
If a nonmarital asset increases in value during the marriage, the amount of that increase could become marital if the enhancement is because of the efforts of either or both spouses or by the expenditure of marital money. For purposes of determining equitable distribution, the judge would have to decide the amount of the increase in value, which would then be marital and subject to division, from the original part that remains nonmarital and the property of the separate owner.
Valuation matters too
Once assets are characterized as marital or nonmarital, the court must assign a value to each one. Each party may submit evidence such as appraisals or other professional value assessments for the judge’s consideration, which can be difficult especially with complex assets like foreign property, stocks and bonds, executive perks, professional practices, family businesses, retirement accounts like pensions, investments, antiques and collectibles, and other similar kinds of property.
Once values are established, the judge will make the equal division of property between the spouses (or unequal if that is found to be more equitable and just.)
Division of property may not refer to its physical division. The court may decide to award each spouse a percentage of the total value of the property. Each spouse will, therefore, receive personal property, assets, and debts whose worth adds up to his or her percentage. It is crucial that neither spouse hides assets during property division as doing so is illegal.
You will do well to seek legal help in the distribution of the following property:
- Equity in family homestead
- Home furnishings
- Business assets
- Professional practices
- Professional degrees
- Retirement benefits (pensions, IRAs, 401(k) plans)
- Estate plan
- Motor vehicles
- Recreational vehicles
- Personal property
- Savings accounts
- Stocks, bonds, and funds
- Compensation for contributions as homemaker
- Hidden assets
This blog scratches the surface of a highly complex and sometimes adversarial issue in Florida divorce.
Do not hesitate to get in touch with a Florida divorce attorney, Pensacola, FL who can answer questions specific to the property and debt of a particular marriage.
Consult a Skilled Pensacola Family Law Lawyer Today
Deciphering exactly how your marital and non-marital property will be divided after your divorce can be an extremely complex and time-consuming process. Be wise and engage our skilled divorce attorney to help you sort this issue. We will help you resolve all your property matters in a manner that minimizes stress and expenses. Reach us at (850) 457-6002 to schedule a initial consultation