Dividing Property In New York Divorce

by ECL Writer
Dividing Property In New York Divorce

Divorce can be a complex and emotional process, particularly when it comes to dividing property. In New York, property division is subject to a set of laws and regulations that can make the process confusing for those involved. Whether you are going through a divorce or simply seeking information on the subject, understanding the basics of property division in New York is crucial. In this article, Eastcoastlaws.com will explore the key factors involved in dividing property in a New York divorce, including the state’s equitable distribution law, marital property versus separate property, and the role of the court in the division process. By gaining a better understanding of these factors, you can make informed decisions and ensure that your interests are protected during this difficult time.

Equitable Division in New York

Since New York is an equitable distribution state, the court will divide the couple’s assets in a fair and equitable manner. Based on a number of variables that demonstrate what each of you contributed to the marriage and what each spouse will need to go forward after divorce, the court determines what is fair. To be deemed fair, the division need not be equal.

If you and your spouse are unable to settle your property conflicts amicably, you may find yourself in court asking the judge to make a decision for you. You will have chances to decide with your husband how you wish to divide your property between yourselves as the divorce process progresses. A documented separation agreement outlining how you intend to divide your property will typically be accepted by the court. Yet, if you and your partner are unable to agree, the court will intervene and divide your assets for you. (N.Y. Dom. Rel. § 236 (B)(3).)

Judges Only Divide Marital Property

The court must first determine whose assets belong to the marriage, which ones belong to each spouse independently, and how much of each type of asset there is before it may divide your assets. Regardless matter what the title indicates, marital property generally refers to all possessions amassed or gained during the marriage. (N.Y. Dom. Rel. § 236 (B)(c).)

You can own separate property if you did so before getting married. It may also include any assets you received during the marriage, such as gifts, inheritances, or compensation for one-on-one injuries. During the marriage, if you trade your separate property for a new property, the new property is yours to keep. The court may, however, classify an increase in the value of your separate property as marital property in certain situations.

For instance, if your husband renovated and upgraded a vacation home you previously owned during your marriage, the rise in the home’s worth is considered marital property because it is the result of your spouse’s labor. The gain in value, however, would remain your separate property if you had purchased an apartment in a burgeoning neighborhood before getting married and it increased in value throughout the marriage simply because other nearby properties did.

Only the marital property is divided by the court during a divorce. It cannot grant your spouse any property that was solely yours prior to or during the marriage. Yet, when determining whether to award spousal maintenance (alimony), if any, the court may take into account all of your financial resources, including both your independent property and your portion of the married estate.

Retirement Assets

The most valuable assets in a couple’s marital estate are frequently retirement assets, such as a 401(k) or pension plan. The court will normally divide retirement savings in accordance with the equitable partition factors stated below unless you and your spouse agree otherwise. When dividing the accounts, the court must ascertain whether the earning/working spouse has a premarital interest (which is separate property). A Qualified Domestic Relations Order (QDRO), a complicated document that specifies the conditions for dividing the accounts, would typically be required by the court.

Factors Considered in Dividing Property

Real property, such as a family home, personal property, like as jewelry, and intangible property, such as earnings, benefits, and debts, are the three forms of property that are frequently divided after a divorce. Debts are handled by the court in the same way as any other tangible, intangible, or personal property. The court must first determine whether an asset or debt is marital or separate before dividing it, and it must then designate ownership or responsibility for it based on a set of criteria intended to produce an equitable outcome.

Factors the court uses to determine a fair distribution of marital property include:

  • each spouse’s income and property at the time of the marriage and at the time of the divorce
  • the length of the marriage
  • each spouse’s age, health, income, potential earnings or future financial circumstances, and property
  • if you have children, the court will consider the need for a custodial parent to occupy or own the marital home and its contents
  • whether either spouse receives spousal maintenance in the divorce, and
  • either spouse’s contributions as a homemaker.

The court particularly evaluates what the spouses may have lost at divorce, such as an interest in inheritance, pension rights, or health insurance, in addition to any other consideration that may be pertinent to the unique circumstances of your marriage. It assesses the potential tax losses that the couples would endure in the future.

Certain assets are difficult for two persons to divide. Cash is a fairly liquid asset that can be easily divided between spouses. Nonetheless, the judge might conclude that splitting up a family business is more difficult. To determine the value of a firm, judges can force the parties to obtain an official business appraisal. If it is impractical to divide a sizable asset, the court may, after it has the value, order a distributive award—a payment from one spouse to the other to even out an uneven division of property.

The court may give you less of the marital estate if you wasted marital assets, even when your role in the breakdown of the marriage is not taken into account in the computation. For instance, you cannot fly your sweetheart to Paris using marital funds without having to pay for it later. The same prohibition applies to selling, giving away, or otherwise encumbering marital property in advance of a divorce. If you do, the judge may impose sanctions on you during the division.

Dividing Marital Debt

The court must allow each spouse an equitable share of the marriage debt in addition to splitting the marital assets. After classifying the debt as either marital or separate, the court will employ the same criteria as those mentioned above to determine the fairest allocation. Any debt that either spouse accumulated during the marriage and utilized for the benefit of the marriage is considered marital debt. The court will divide the debt between the spouses, for instance, if one spouse applied for a store credit card and used it to buy clothing for the couple’s kids.

Separate debt is exclusively the responsibility of the spouse who incurred it, and the court will assign that spouse the obligation. For instance, if one partner bought pricey jewelry for an ex-lover, the court will order that partner to bear the whole cost of the debt.

The deal either spouse made with a lender cannot be changed by a court, which is crucial to comprehend. If a shared credit card is used, the lender may pursue payment from either spouse even if the court may assign the Lowes credit card to one spouse.

Alimony Is Determined Separately

After a divorce, one spouse makes a payment to the other, known as alimony or spousal maintenance, to help pay for the supported spouse’s expenditures. The court must make an equitable decision about spousal maintenance, just like it did with the division of property. Payments may be made on a regular basis (monthly, for instance), all at once, or over an extended period of time. During the divorce process, one spouse may ask for interim maintenance payments, the amount of which the judge will determine based on predetermined income benchmarks. (N.Y. Dom. Rel. § 236 (B)(5-a).)

A permanent maintenance award may be made by the court at the same time that it divides the couple’s assets and grants a divorce. In New York, judges use many of the same criteria to determine how much spousal maintenance to provide. The degree of education and earning potential of the spouses, the standard of living in the marriage, and the requirements of any children are some further considerations.

Any history of domestic violence that may have prevented the battered spouse from finding or improving employment during the marriage may also be taken into account by the court. The ability of a spouse to pay for maintenance is just one example of a significant element that the court is entitled to consider.

Settlement Agreements

The court encourages spouses to work together to obtain a settlement agreement for the distribution of property and debt, as it does with the majority of divorce-related matters including child custody and spousal support. Before putting any agreement in paper, negotiating partners should have a consultation with an attorney to go over their choices. Most of the time, the court will approve the settlement if it is equitable to both spouses.

Sources

You can read the law on division of property and spousal maintenance in the New York Consolidated Statutes, Article 13 of Domestic Relations, Section 236, which is divided into parts A and B. Part A applies only to divorces filed in New York before July 19, 1980. For all later cases, use part B.

If you have questions about your own case, you should contact a local attorney for advice.

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