Splitting Up Assets During A Divorce
One of the most complicated areas of New Jersey divorce law is the division of marital assets. Splitting up a family’s property during a divorce typically requires the help of an experienced divorce attorney who will identify a couple’s martial assets, determine the value of the assets, and arrive at an equitable distribution of the assets that both spouses agree to.
Asset division is not always an easy process, especially when a couple has significant assets such as real estate, pensions, or stocks. The tax implications and liquidity of the assets should be taken into account as well. For example, when one spouse receives a share of a retirement account, the after-tax value of the account might be significantly different than the listed value of the account.
Another example of an illiquid asset may be a stake in closely held family business or a home that will not sell well in the current real estate market. The home may be worth more if the real estate market improves, but the additional property tax and maintenance issues associated with the home may not be ideal for the spouse receiving the home.
Not all property is treated equally in the asset division process. There is marital property and non-marital property. Marital property typically consists of assets acquired during the marriage. Non-martial property includes inheritances, gifts, and assets brought into the marriage and not comingled with the other spouse’s finances. Marital property may include assets such as the family home, major investment, and a family business. Only marital property can be divided in a divorce.
The appropriate identification and valuation of marital property is essential for arriving to a proper asset division in any divorce.
Source: Forbes, “Understanding How Assets Get Divided In Divorce,” Jeff Landers, 4/12/11