2. Which assets constitute marital property in a divorce, and what constitutes separate property?
One of the first steps in getting a divorce is determining your assets and liabilities, with the goal of achieving an equitable division of property.
But equitable does not always mean equal, and one important aspect of this process is identifying and valuing assets that constitute marital property, which was earned/accrued during the marriage, or separate property, which was earned/accrued before the marriage, or inherited before or during the marriage.
In the event that one spouse has a separate property claim, it is critical to work with an attorney to trace and identify that separate property.
That said, pre-marital businesses are also vulnerable to claims for equitable distribution. A valid prenuptial or postnuptial agreement can help eliminate or limit the threat to a pre-marital business venture in a future divorce.
Examples of separate property, which are protected from equitable distribution in New York State may include: inheritances to the degree that the inheritance was maintained separately from marital assets, earnings from personal injury claims and separately maintained pre-marital accounts.
3. If I kept my earnings in my own account through the marriage, in my name alone, aren’t I protected from having to share these accounts with my spouse?
Likely not. If you have been depositing marital earnings into your account, the title on the account is not determinative as to distribution. In fact, if you had deposited your separate property and your marital earnings into the same account in your name alone, you may have made a huge mistake. You may have commingled your separate property with marital property, thereby losing your separate property claim.
Understanding the financial ramifications of divorce later in life is critical.
As a financial planner, working with your client’s divorce attorney will make the transition smoother for the client. And your client will benefit from having a team of professionals who are knowledgeable and collaborative and working together to their achieve the best result possible given each unique circumstance.
Lisa Zeiderman is a matrimonial and family law attorney, and certified divorce financial analyst.