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How Does the Court Split Up Our Assets and Debts?
Florida is an “equitable distribution” state, which means that the Court initially presumes that all marital assets and debts should be divided equally. However, there are many exceptions to this rule and many questions about marital versus non-marital status of property in some cases. An Orlando divorce attorney experienced in equitable distribution is essential in any dissolution of marriage action.
Here are some basic guidelines. The first step is to divide the non-marital assets and liabilities from the marital assets and liabilities. Only marital assets and liabilities are distributed by the court, while the parties each keep their own non-marital assets and liabilities.
Florida Statutes section 61.075 governs equitable distribution, which requires that the marital assets and debts of the divorcing couple must be identified and then divided in a fair way. Before that can be done though, the non-marital assets and debts of the divorcing party must be identified and separated from the marital assets and liabilities.
The court will generally assume that all assets and liabilities acquired during the marriage are martial unless a party can prove that a particular asset or debt belongs primarily to one spouse. Examples include property or money that each spouse owned before getting married, gifts received through inheritance, personal injury awards, and of course any property identified in a pre-nuptial or post-nuptial agreement. When a couple purchases a house together, it will likely be considered a joint investment and thus marital property. The same is true of an individual’s retirement account, 401(k), or savings account if that person’s spouse made contributions to it during the marriage. Marital assets also include the appreciation in value of non-marital assets. Property acquired before marriage is typically non-marital while property acquired during marriage is typically marital property.
The distinction is important because marital assets are subject to distribution while non-marital assets remain the property of the individual spouse. The party who acquired the nonmarital asset or liability will keep it free from the claims of the other spouse.
The court assesses the factors in section 61.075 of Florida Statutes when determining who gets what; both parties need not show equal assets. The determination of what constitutes an equitable result is not to be guided by arbitrary standards, but rests upon considerations arising out of the facts presented.
The distribution of property and liabilities also impacts the court’s decision whether or not to award alimony, because property and debts are divided first, then the court analyzes the parties’ financial need versus ability to pay.
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Detailed Analysis of Property Issues
Once the court determines the extent of the couple’s marital property and debts, they are then divided up in a fair way. A 50/50 distribution of marital debts and liabilities is the starting point required by section 61.075, but the court can vary from that initial starting point of distribution and do equity, meaning the court can grant an unequal share of the marital property to one party over the other, depending on the following factors:
- Each spouse’s contribution to the marriage, including time spent on the care and education of the children and services as a homemaker.
- The economic circumstances of the parties.
- The length of the marriage.
- Any interruption of a professional career or education by either party.
- One spouse’s contribution to the personal career or educational opportunity of the other spouse.
- The desirability of one spouse retaining any asset, including ownership of the business, free from any claim by the other party.
- The contribution of each spouse to the acquisition and production of income, or the incurring of liabilities to, the marital assets and nonmarital assets of the parties.
- The desirability of retaining the marital home for the use of the parties’ dependent children, when it would be equitable to do so.
- The intentional dissipation, waste, or depletion of marital assets after the filing of the petition or within two years before the filing of the petition.
- Any other factor that would do equity between the parties.
How the Court Divides Your Property & Debts
The court must apply a presumption in favor of equal distribution when making an award, even if there is no evidence to show which party contributed more or less to a particular item. If there is no evidence or argument proffered about a party’s actual contributions to any asset, the asset is treated as having been equally acquired. Stocks, bonds, mutual funds and crypto currency are counted as property subject to distribution under section 61.075(1)(b), even if they are not in the name of the person seeking distribution.
An unequal division of marital property may be made only if the record contains evidentiary support for the qualitative and quantitative contributions of each spouse or either spouse’s contribution to the acquisition or dissipation of marital assets.
In all cases, and in a high-asset divorce in particular it’s important to hire a family attorney in Orlando who will protect what’s yours. Contact the Spence Law Firm for a FREE consultation with a knowledgeable equitable distribution lawyer.
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