Property Division
5 frequently asked questions with detailed answers
Property division depends on your state's laws. Nine states use 'community property' rules (assets split 50/50). The remaining states use 'equitable distribution' (fair, but not necessarily equal division). Factors include length of marriage, each spouse's income and earning potential, contributions to the marriage, and custody arrangements.
Not necessarily. In community property states, marital assets are typically split 50/50. In equitable distribution states, courts divide assets fairly based on many factors. Separate property (owned before marriage, inherited, or gifted) usually remains with the original owner. Prenuptial agreements can also affect division.
Options for the marital home include: one spouse buys out the other's share, sell the home and split proceeds, continue co-ownership (rare), or one spouse keeps the home in exchange for other assets. Factors include whether children are involved, ability to afford the mortgage, and each spouse's housing needs.
Retirement accounts earned during marriage are typically marital property subject to division. A Qualified Domestic Relations Order (QDRO) is needed to divide 401(k)s and pensions without tax penalties. IRAs can be transferred incident to divorce. The portion earned before marriage may be considered separate property.
Marital property generally includes assets acquired during the marriage: income earned, real estate purchased, retirement contributions, vehicles, investments, and business interests developed during the marriage. Gifts and inheritances to one spouse, and property owned before marriage, are typically considered separate property.