Property Division Flashcards
What are the two key steps in property division generally?
Categorize and/or classify assets
Distribute the assets
What is considered “separate property” of a spouse?
Property acquired before marriage
Gift or inheritance acquired in their name only
Property acquired after separation
Recovery for pain and suffering
Passive appreciation from separate property (increase in value from passage of time)
If appreciation was due to active efforts - it’s a marital asset up to the amount of appreciation(growing a business)
Active vs Passive appreciation example
Active - growing a business
Passive - value of stocks and bonds
What is marital property?
Anything else that is acquired during the marriage
What is tracing of marital property?
One type of property is contributed to another
Can retain original classification as long as it is traceable.
What is commingling?
When property is commingled with marital property and loses its separate identity
Ex: a checking account that becomes the couples acct after marriage
It becomes marital property
How is marital property valued?
Court hearing - case by base basis of valuation.
What are the factors used for equitable distribution of marital assets?
Common sense approach on essay - look to the facts
Age/health - harder for one spouse to earn so maybe a larger share
Duration of marriage
Marital fault
Liquid or nonliquid character of assets
Income
Child custody
Tax consequences
Any other factor the court deems appropriate
How will court award assets? What are the two ways?
In kind - give them the asset itself
Cash award - lump sump or installments ok
Is marital debt taken into consideration?
Yea duh. It’s a marital asset with a negative value
What about pensions? How are they divided?
Under the Employee Retirement and Income Security Act (ERISA)
Court must comply with special rules imposed by federal law.
Do courts take alimony into consideration when dividing marital property?
No.
