New York Equitable Distribution & Divorce

by ECL Writer
New York Equitable Distribution

Divorce can be a complex and emotional process, especially when it comes to dividing assets and property acquired during the marriage. In New York, divorcing couples must go through a process known as equitable distribution, which is designed to divide property and assets fairly between spouses. While equitable distribution may sound straightforward, the process can be complicated, and it’s important to understand your rights and obligations under New York law. In this article, Eastcoastlaws.com will provide an overview of New York equitable distribution law, including how assets are classified, how the court determines what is “fair,” and what factors the court considers when dividing property in a divorce. Whether you’re considering divorce or are already in the midst of the process, understanding New York’s equitable distribution law can help you navigate this challenging time with greater confidence and clarity.

What Is Equitable Distribution Of Marital Property In New York?

Equitable distribution is the legal principle that guides the division of marital property in New York State when a couple of divorces. It means that marital property is divided fairly and justly between the two parties, but not necessarily equally.

Marital property includes all assets and debts acquired by either spouse during the marriage, regardless of whose name is on the title or who earned the income. This includes, but is not limited to, real estate, cars, bank accounts, investments, retirement accounts, pensions, and personal property.

Separate property, which is not subject to equitable distribution, includes assets acquired before the marriage, gifts or inheritances received during the marriage, and any property designated as separate in a prenuptial or postnuptial agreement.

When dividing marital property, the court considers a variety of factors, including the length of the marriage, the income and earning capacity of each spouse, the age and health of each spouse, and any contributions made by each spouse to the marriage. The court may also consider any fault in the breakdown of the marriage, such as adultery or cruelty.

The court has broad discretion in determining the division of marital property and may divide the property equally or unequally, depending on the specific circumstances of the case. For example, if one spouse has a significantly higher earning capacity than the other, the court may award a larger share of the marital property to the lower-earning spouse to ensure a fair and just distribution.

It’s important to note that equitable distribution applies only to marital property, not to separate property. In some cases, separate property may become commingled with marital property, making it difficult to distinguish between the two. In such cases, the court will have to determine whether the commingled property should be considered marital or separate.

Is New York An Equitable Distribution State For Divorce?

New York is an equitable distribution state for divorce, which means that marital property is divided fairly and justly, but not necessarily equally, between the two parties. This is in contrast to community property states, where marital property is divided equally.

Under New York law, marital property includes all assets and debts acquired by either spouse during the marriage, regardless of whose name is on the title or who earned the income. Separate property, on the other hand, includes assets acquired before the marriage, gifts or inheritances received during the marriage, and any property designated as separate in a prenuptial or postnuptial agreement.

When dividing marital property, the court considers a variety of factors, including the length of the marriage, the income and earning capacity of each spouse, the age and health of each spouse, and any contributions made by each spouse to the marriage. The court may also consider any fault in the breakdown of the marriage, such as adultery or cruelty.

In New York, the court has broad discretion in determining the division of marital property. The court may divide the property equally or unequally, depending on the specific circumstances of the case. For example, if one spouse has a significantly higher earning capacity than the other, the court may award a larger share of the marital property to the lower-earning spouse to ensure a fair and just distribution.

It’s worth noting that equitable distribution applies only to marital property, not to separate property. In some cases, separate property may become commingled with marital property, making it difficult to distinguish between the two. In such cases, the court will have to determine whether the commingled property should be considered marital or separate.

New York is considered an equitable distribution state for divorce, which means that the court will strive to divide marital property fairly and justly between the two parties, taking into account a variety of factors. However, the specific outcome of a divorce case will depend on the unique circumstances of each case.

What Property Is Subject to Equitable Distribution?

The courts in New York merely divide the marital estate; spouses retain their separate possessions. All possessions acquired by one or both spouses during the marriage are considered marital property, regardless of who made the purchase. Marital property examples include:

  • each spouse’s income earned during the marriage
  • the property purchased with either spouse’s income
  • the property the couple purchased while married (such as a house or car)
  • the retirement benefits each spouse earned during the marriage, and
  • the appreciation of marital property while the couple was married. (N.Y. Dom. Rel. § 236 (B).)

What Is Separate Property?

When a couple of divorces, the courts do not distribute their separate property. Instead, each couple keeps their own independent property—with the exception of any value increases to which one spouse may have contributed. Included in the separate property is:

  • property either spouse acquired before marriage
  • property either spouse received individually as an inheritance or gift, except the other spouse
  • compensation for personal injuries to either spouse
  • any property characterized as separate property in a valid prenuptial agreement or other written contract, and
  • property acquired from the proceeds or appreciation in the value of a separate property unless that appreciation is partly due to the efforts or contributions of the other spouse. (N.Y. Dom. Rel. § 236 (B)(d).)

Is A Business Or Professional Practice Subject To Equitable Distribution?

Yes. The court will split “property” in a divorce using equitable distribution. This “property” includes businesses, professional practices, and increased earning potential owing to obtaining a vocation, professional license, educational degree, profession, or license. As was previously mentioned, it may be difficult or undesirable to divide interests in a firm or job.

The actual business or practice will normally be awarded to the spouse managing it in this case, and the other spouse will be given other property to make up the deficit. (New York Dom. Rel. 236)

Factors Considered In Equitable Distribution

Equitable distribution is a legal framework that determines how a couple’s property and assets should be divided during a divorce. In equitable distribution, the court takes into account various factors to ensure that the distribution is fair and just for both parties. Here are some of the factors that are considered in equitable distribution:

  • Length of marriage: The duration of the marriage is an essential factor in equitable distribution. A long marriage is likely to result in a more equitable distribution of property than a short-term marriage. In some states, if the marriage was less than a specific number of years, the court may not divide the property.
  • Income and earning potential: The court will consider the income and earning potential of both parties. The spouse who earns less is likely to receive a more substantial share of the property, and the higher-earning spouse may be required to pay spousal support.
  • Contributions to the marriage: The contributions of both parties to the marriage, including non-financial contributions such as homemaking, child-rearing, and support, are taken into account. This factor is particularly relevant when one spouse has sacrificed their career to support the other spouse.
  • Age and health: The age and health of both parties are also considered. In some cases, a party may be awarded a more substantial share of the property to account for their future medical expenses.
  • Assets and liabilities: The court will also consider the assets and liabilities of both parties. This includes property, investments, debts, and other financial obligations.
  • Custodial arrangements: If the couple has children, the court will consider their custody arrangements when deciding on equitable distribution. The court may award the primary caregiver a more substantial share of the property to ensure that the children’s needs are met.
  • Tax consequences: Finally, the court will consider the tax consequences of the distribution. The court may divide assets in a way that minimizes the tax liability for both parties.

Equitable distribution is a complex legal framework that considers various factors to ensure that the distribution of property and assets is fair and just for both parties. The court takes into account the length of marriage, income, contributions, age, health, assets and liabilities, custodial arrangements, and tax consequences when making its decision.

How Is Property Divided In A New York Divorce?

Most of the time, divorced couples are able to come to an agreement on property allocation that satisfies the needs of both spouses. The division of assets and debt is a topic on which the courts encourage couples to collaborate. A settlement agreement will typically be approved by the court if it is equitable to both parties.

The judge will decide whether each item of property or debt falls under the “marital” or “separate” categories and will then divide the estate using the aforementioned criteria if you and your spouse are unable to come to an agreement on how to divide marital assets. The court must abide by the terms of a prenuptial agreement if the couple signed one before getting married.

Separate Property Vs. Marital Property In New York

Any separate property that either spouse owned or inherited before the marriage, any settlement money received as a result of an injury before the marriage, or any assets listed in a prenuptial agreement will not be regarded as marital property and will not be subject to the equitable distribution procedure. Having said that, independent assets might have been combined with marital ones. For instance, if one spouse bought property before the marriage and later added the other spouse’s name to the deed, it now belongs to both partners and is considered marital property. Alternatively, the definition of separate property might get a little hazy and may be viewed as marital property if one spouse owned an investment property prior to marriage while the other contributed to the mortgage and upkeep afterward. The distribution of these assets could then be decided by the New York courts in a significant manner.

Equitable distribution does sound challenging. And occasionally, depending on the couple, it is. Nonetheless, a marriage can typically come to an understanding with help in order to satisfy the demands of both parties.

Expert divorce attorneys in New York assist couples in settling their divorce amicably and fairly by dividing their assets and debts. Your divorce attorney should be a tenacious advocate for you if you are unable to come to an agreement.

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