When a marriage ends, property and finances that have long been intertwined must be separated, valued and divided. The property division aspect of the divorce process can be lengthy and complex. If significant assets are involved, it can be difficult to reach an agreement, and extensive litigation may become necessary to sort through all the issues.
How Is Property Division Determined?
Asset division in North Carolina is generally subject to a legal standard called equitable division. This means the court will consider various factors to determine an outcome that it considers fair (which may not necessarily be an equal division). These factors include:
- The duration of the marriage
- The age, health and earning of both spouses
- Income, property and debt of both spouses
- Expectation of retirement benefits
- Contributions to each spouse’s education
- Liquid or nonliquid property
- Tax consequences
Establishing which property is part of the marital estate — and therefore subject to division — is a separate hurdle in its own right. Certain property interests such as gifts, inheritances and property acquired before the marriage can be excluded from property division on the grounds that it is one spouse’s separate property.
There is also the question, in many divorces, of who gets the house.
How Property Is Classified
Property is classified in three different ways during the equitable distribution process. The three different types of property are:
- Separate property: all property owned by either spouse before the marriage, property obtained as an inheritance or gift and property obtained after the date of separation
- Marital property: all property owned that was obtained during the marriage, including all retirement benefits and vested pension
- Divisible property: real and personal property obtained during the marriage but before separation
Our lawyers understand the nuances of marital versus separate property and are skilled in handling all types of issues, including cases involving substantial assets. Gregory Plumides is an accomplished trial attorney with nearly two decades of experience; he is well-equipped to fight for you in court. He is also skilled at leveraging strengths in clients’ cases to negotiate favorable out-of-court resolutions.
What Happens to The House?
Because of the memories and emotions tied to it, the marital home is often one of the most contentious sticking points in the property division process of a divorce.
For most divorces, it is better for you and your spouse to work together on a property division settlement that satisfies both of you. While neither you nor your spouse is likely to be happy with every aspect of the agreement, it is better to remain in control of the process. A judge who does not fully understand your situation could rule in a way that leaves neither of you happy.
Some common resolutions to control of the marital home include:
- Selling the house and splitting the proceeds
- One spouse buying out the other’s share of the home to continue living in it
- Continuing to split the payments on the house if one spouse will continue living there so your children do not have to move
I Own a Business – What is Used to Determine Child Support?
Tax issues can have a significant impact on your future. We will evaluate your specific situation and develop a plan to protect your personal and professional financial goals.
Your tax income is not always the income used in child support calculations. Do not make the mistake of thinking you can deduct all of your business expenses to reduce child support obligations.
Child support is based on North Carolina’s child support guidelines to determine monthly payments. We can walk you through the calculation process so you know what to expect during divorce and child support proceedings.
What Happens to My Retirement Accounts?
Specific laws and guidelines are followed when splitting up retirement accounts during divorce. Every situation is unique and depends on the details of each account, including how long the employee has worked for the company and if their account is vested.
- Health care benefits
- Military benefits
- Survivor benefits
Pensions are more complicated during divorce. Vested pensions are considered marital property and will be divided according to equitable distribution guidelines. Non-vested pensions will be divided if the employee worked for the company for 11 years or more.
You are able to receive money from a vested annuity if you worked there for 12 years or more. Spouses are not entitled to any money in a non-vested annuity.
Is fault used in dividing marital property?
It depends. Fault is never used when dividing marital property although, if one spouse is shown to have committed “marital waste,” the same could be a factor when the court divides the marital property. Fault or marital misconduct is only relevant as to claims for divorce from bed and board, post-separation support and/or alimony.
What is Equitable Distribution?
Equitable distribution is a cause of action requesting that the court equitably divide marital assets, marital debts, separate assets, separate debts and/or divisible property. A claim for Equitable distribution must be pending prior to the entry of divorce or you will forever lose your rights to request an equitable distribution from the court.
When can I file for Equitable Distribution (ED) and when is ED determined?
You may file a claim for Equitable Distribution any time after separation and even before an action for divorce is filed. Equitable Distribution is a long process starting with the filing of the claim and concluding with the court’s determination as to how the property should be distributed. In Mecklenburg County, prior to an ED claim being set for trial, the parties must participate in a form of alternative dispute resolution (ADR) such as mediation or judicial settlement conference.
What happens to my finances in a divorce?
Financial matters are a grave concern for many of our clients. We know how divorce can impact your financial outlook now and in the future. Our diligent preparation and experience as trial lawyers helps us develop a strategic plan to protect your best interests.