How are Assets Split in a Divorce
We will do whatever is necessary so that you can achieve a fair and just result as you and your spouse divide property. This often requires that we subpoena records; use certain tools called interrogatories, requests for production, and requests for admission; perform an investigation; and occasionally depose witnesses. That may sound extensive, but doing this process right can save you thousands, and even tens of thousands, of dollars in marital assets. Here at Red Law of Ogden, Utah, we have the experience and ability to carry you through this process successfully. However, we also have the skills to negotiate a fair settlement of your case so your divorce can conclude quickly, if your spouse is willing and reasonable.
Splitting Specific Assets
- The Home. If divorcing individuals cannot agree on who should receive the home, the court may do one of several things: (1) order that the home remain in the possession of the parent who will have custody of the children until the children move out of the home; (2) order that the home be given to one party and award the other party other marital assets equal to the value of his/her share of the home; (3) allow one individual to buy out the other individual’s interest in the home; or (4) order that the home be sold and the equity split between the two individuals.
- Other Real Property. Real property refers to land, homes, condominiums, and other structures attached to land. If the divorcing individuals cannot agree on who should receive the real property, a court may: (1) order the property be sold and the equity divided between the two individuals; (2) allow one individual to buy out the other individual’s interest in the real property; (3) order that the real property be given to one party and award the other party other marital assets equal to the value of the real property.
- Retirement & Pension Plans. If only one of the divorcing individuals has a retirement or pension plan, the other individual is typically entitled to half of the amount earned during the course of the marriage (i.e. if the marriage lasted 10 years, the retirement accrued during that 10 year period will be divided, but anything accrued before the marriage will not be divided). If both individuals have retirement or pension plans, the court could either (1) order that each of the parties retain the full value of their own plans, or (2) order an equitable division of all retirement accounts. Whenever a retirement account is going to be divided, a special document needs to be prepared called a “Qualified Domestic Relations Order.”
- Personal Property. Personal property includes anything movable, such as cars, clothes, furniture, etc. Courts in Utah divide personal property equitable (fairly).
General Rules the Court Usually Follows
If a divorcing couple cannot come to an agreement on how to split their marital assets, a court will decide for them. There are three basic rules that will help you understand how your assets will be split in a divorce: (1) Utah courts will divide assets equitably (fairly) between spouses; (2) all marital property will be divided between the two spouses; and (3) separate property will not be divided between the two spouses. We’ll discuss each of these three rules in more detail below.
Utah Courts Distribute A Couple’s Assets Equitably
In a Utah divorce, courts will use an “equitable” approach to dividing property between spouses. This means that the courts, above all, want the property to be divided fairly. An equitable division of property between spouses doesn’t necessarily mean that each spouse will receive 50% of the couple’s assets—although that too occurs. Courts will not only consider the monetary value of the couple’s assets, but it will also consider all of the circumstances of the divorce and the circumstances of the individual spouses. For example, a court may find it is equitable for the parent who will have physical custody of the children to be awarded the couple’s home, or that the spouse who owns and operates his/her own business be awarded sole ownership of that business.
Marital property is that property that is acquired or earned during the marriage, so long as the property is not acquired by gift or inheritance. Anything that is not classified under “separate property” below will be considered marital property.
There are three main categories of property that will not be split and distributed between spouses upon divorce:
- Inherited Property. Inherited property is any property that was left for the benefit of one spouse after another person’s death.
- Gifted Property. Gifted property is any property that was given to one spouse.
- Premarital Property. Premarital property is any property that one spouse accumulated prior to the marriage and then brought into the marriage.
These are only general rules. Like with most laws, there are exceptions to these rules that are often complex and should be explained by your attorney. Contact Red Law Utah today for a consultation.