One of the biggest concerns couples have when getting divorced is how their property will be divided. New York has unique property distribution laws for couples getting separated or divorced. In this guide, our Long Island divorce lawyers explain the complex terms of splitting assets in a divorce.
Equitable Distribution
Before seeking a divorce in New York, you should first understand what you will split with your spouse and what you will keep. New York is an equitable distribution state. This means that the property will be divided between the spouse is a fair and equitable way.
The court comes in when the spouses fail to reach a consensus about the division of property. The court helps in dividing the property in a fair and just way. The division is guided by a set of factors that indicates what the spouse contributed before the divorce. The court can only accept a written agreement from the spouses on how they intend to split the property.
Marital Vs. Separate Property
Throughout the divorce process, it is essential to understand which property belongs to each spouse. Before dividing a debt or an asset, the court first characterizes it as either a separate or marital property. There are two types of property that are considered: marital property or separate property.
Marital Property
This is any property acquired during the marriage, regardless of who bought it and what name is indicated on the title.
Examples of marital property include:
Real property you and your spouse bought during the marriage, including assets such as a family home (excluding any contributions of your separate property you may have made);
Personal property purchased during the marriage, such as jewelry, cars, furniture, artwork;
Intangible property including benefits, income, and debts;
Advanced educational degrees, and permits to engage in businesses;
Gifts to each other.
Separate Property
This refers to the property earned or acquired before the marriage.
Examples of separate property include:
Real property that was acquired or owned prior to the marriage;
Personal property that was acquired or owned prior to the marriage;
Property that was acquired during the marriage from someone other than your spouse such as an inheritance or gift;
Compensation for personal injuries during the marriage that did not relate to a loss of wages or earning capacity;
Increases in the value of separate property, unless your spouse helped contribute to the increase in value;
You and your spouse determined which property was separate through a written agreement.
During a divorce, you and your spouse can decide how to divide your marital property if you both agree. However, if you cannot come to an agreement, the court then assigns responsibility or ownership for the property. This is based on the set guidelines that provide fair results to each spouse.
Determining Who Gets What
There are various factors that are considered when dividing marital property in a court. For example, the court can consider your financial resources, such as shares in the separate property and marital property.
The court considers the following when determining equitable distribution:
The income and property of each spouse
The duration of the marriage
The age and health of both parties
The custodial parent’s need to occupy or own the marital residence and to use or own its household effects
The loss of health insurance benefits upon dissolution of marriage
Any award of spousal maintenance (alimony)
Any equitable claim to, interest in, or direct or indirect contribution to the acquisition of marital property
The liquid or non-liquid character of all marital assets
The probable financial circumstances of each spouse
The impossibility or difficulty of evaluating any component asset or any interest in a business, and the economic desirability of retaining that asset or interest intact and free from any claim or interference by the other party
Tax consequences of divorce on each party
Wasteful dissipation of assets by either spouse
Any transfer or encumbrance made in contemplation of a matrimonial action without fair consideration
Any other factor the court finds to be relevant
The court will look at these factors and decide what will be the fairest way to divide the spouse’s marital property, hence why New York is an equitable distribution state.
This doesn’t always mean a 50/50 split. The court will try to divide assets as equitably as possible. However, it would be impractical to do so for assets such as interests in an enterprise. In such a case, the court orders a distributive award.
When a distributive award is ordered, it refers to payments made to balance the uneven distribution of assets in order to supplement, facilitate, or effectuate the distribution of property. This may be payable in either a lump sum or through fixed payments over a period of time.
Contact Pickney Law Firm
New York’s property division laws can be quite confusing. It is in your best interest to speak to a Long Island divorce attorney to ensure you get your fair share of property in your settlement. At Pickney Law Firm, PLLC, we are dedicated to protecting our client’s rights and providing them with sound guidance during the divorce process. If you have any questions about your divorce and property division, contact us to schedule a consultation.
For experience, excellence, and results call Pickney Law Firm, PLLC today at (516) 565-5555 to learn more.