In the United States, we have two methods of dividing a married couple's
property in a
divorce: equitable distribution and community property. New York follows the equitable
distribution model, which means a married couple's property is divided
equitably – or
Unlike community property states, such as California, Nevada, and Arizona,
where a couple's assets are split down the middle, equitable distribution
states look at the totality of a couple's circumstances and divides
their marital property in a manner that is deemed fair.
Before New York became an
equitable distribution state, it was a "common law property state." Under the old system,
when a couple divorced, their property was distributed to the spouse whose
name was on the title. For instance, if a mortgage was titled in a wife's
name alone because her credit was better than her husband's, she would
get the house in the divorce.
New York Is Now an Equitable Distribution State
Today, New York is an equitable distribution state, as the majority of
the states are. Only a handful of states follow the community property
method of distribution.
When a Long Island couple divorces and the court is involved, the court
must divide their property in a fair and equitable manner. However, this
does not necessarily mean the couple's assets will be divided evenly.
When a judge is dividing a couple's marital assets, he or she will
consider the following factors before rendering a decision:
- The age and health of each spouse
- The length of the marriage
- Each spouse's income and assets
- Any health insurance or inheritance rights a spouse loses because of the divorce
Whether or not the court awards
- Either spouse's contributions as a stay-at-home parent or homemaker
- Either spouse's contributions to the assets
- Each spouse's earning capacity
- The tax consequences of the division of the assets
- Whether either spouse has wasted the marital assets
- Any other factor the court deems relevant
When a couple's assets are divided, the first order of business is
to determine what is marital property and what is separate property. Only
marital property is subject to division in a divorce; therefore, each
spouse gets to keep his or her separate property, which includes:
- Property acquired before the marriage
- Inheritances and gifts received by one spouse alone
- Personal injury awards for one spouse
- Any property distinguished as separate property in a prenuptial or postnuptial agreement
The appreciation of separate property assets that are active in nature,
ie. a business or commercial real estate, or where active efforts were
used to increase the value of the separate property assets are marital.
Speak to your matrimonial counsel for a greater understanding of whether
the appreciation of a separate property asset is marital. In addition,
separate property assets that are commingled (placed into a joint account
with the other spouse) will be deemed marital. Consult with your matrimonial
attorney for further information on these nuances.
Can Spouses Reach Their Own Agreement?
Yes, absolutely. We encourage spouses to
collaborate with each other and reach their own marital settlement agreement. However,
if a couple is unable to agree on the terms of their divorce, then a judge
will have to step in and decide for them, and in accordance with New York's
laws of equitable distribution.
If you and your spouse can agree to continue negotiations until you reach
a fair settlement, it would be the most cost-effective approach. When
couples are able to put their differences aside and negotiate a settlement,
they can save a fortune on litigation costs and as a result, preserve
the marital estate as much as possible.
Looking for a Long Island divorce attorney? Contact our firm to take advantage of more than 100 years of collective experience!