When you’ve decided to divorce, one of the things you and your soon-to-be-ex may argue about is the division of property. There are several considerations you should keep in mind when you decide how to handle who gets what.
According to North Carolina statute § 50-20, there are three types of property:
Marital property is any personal and real property owned that one or both spouses acquired during the marriage before the date they decided to separate. Examples include:
- Bank accounts
- Retirement accounts
- Real estate
- Vested and nonvested pension plans
- Motor vehicles
- Deferred compensation rights
- Vested and nonvested military pensions under the federal Uniformed Services Former Spouses’ Protection Act
Separate property is real and personal property either spouse owned before getting married or acquired during the marriage as a gift or inheritance. Separate property might also include assets acquired after the date of separation. Examples of separate property include:
- A home owned before getting married
- A gift one spouse received from the other for a birthday or holiday
- Acquired property using separate property assets with the intent to keep it as separate property
- Gifts received from a third party while married
- Property only in one spouse’s name and acquired during the marriage but not used for the benefit of the other spouse
- Inheritance received from family before or during the marriage
- Property indicated as separate in a written contract, such as a post-nuptial agreement
Divisible property is all personal and real property, such as:
- Property, property rights, or any such portion received after the separation date but before the distribution date acquired by the efforts of either spouse while married but before the separation date, including bonuses, contractual rights, and commissions
- Diminution and appreciation in marital property and divisible property value of the spouses occurring after the separation date and before the distribution date, except appreciation or diminution in value resulting from post-separation activities or a spouse’s actions not treated as divisible
- Passive income from marital property received after the separation date, such as interest and dividends
- Passive decreases and increases in financing charges and marital debt and interest related to any marital debt
Factors Contributing to the Division of Property in North Carolina
Typically, the court rules for equitable distribution when dividing property between divorcing spouses unless there’s a reason that equal division might not be equitable. That generally means a 50/50 split of the assets to both parties.
If you and your spouse can agree to the terms of property division, you have more control over the outcome. Coming to an amicable resolution allows both of you to walk away from the marriage with the assets you want the most or rightfully deserve.
However, if disputes arise and you have to settle the matter in court, the judge will review various factors to determine how to divide your property. These factors might include:
- Age and health of each spouse
- The necessity for the custodial parent to remain in the marital home if the divorcing spouses share young children
- Income, property, and debts owned by both parties
- Duration of the marriage
- Obligations from previous marriages, such as child support for children shared with an ex
- Any direct or indirect contribution, interest in, or equitable claim to acquiring marital property by the party without a title, including any joint effort or expenditures and services and contributions, or lack of effort as a parent, spouse, homemaker, or wage earner
- The expectation of retirement, pension, or other deferred compensation rights considered to be separate property
- Contributions one party made to the other for their education or career advancement
- Tax consequences for each spouse, including state and federal tax consequences they would have incurred if they liquidated or sold the divisible and marital property on the valuation date
- Direct contributions to increase the value of the separate property during the marriage
- Difficulties evaluating any interest in a business or component asset, profession, or corporation and the economic desirability of retaining an interest or asset intact and free from interference or a claim by the other
- Liquid or nonliquid character of all divisible and martial property
- Actions by either spouse to preserve, maintain, expand, develop or neglect, waste, devalue, or convert the divisible or marital property, or both, after separation but before distribution
The judge can also use additional factors they deem appropriate to determine how to divide the property between you and your spouse in a way they believe is equitable or fair.
If you’re going through a divorce in North Carolina and want to learn about your legal options for the division of property, contact Marshall & Taylor PLLC immediately for a confidential consultation. We can review the circumstances of your divorce to determine what type of property you have and create a legal strategy to fight for the assets you want and deserve.
Call us at (919) 833-1040 today to speak with one of our experienced and dedicated property division attorneys.