Posts Tagged ‘non-marital property’

Dividing Property in Divorce: What’s Separate & What’s Marital?

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sandraguzman nov2

In a divorce, dividing up property is much more complicated than figuring out who gets to keep the good china and who takes the comfy recliner. There are many factors to consider, including who purchased the property, when it was purchased, and whether the other spouse contributed to the upkeep of said property. Property in a divorce falls into two main categories: Separate and marital.

What is the difference between separate property and marital property?

Separate property is property that either was acquired prior to the marriage, after the date of separation, or property that is exempted from being considered jointly held, such as gifts or inheritances from family members. Spouses can have specific agreements that supersede this general rule, such as prenuptial agreements or written contracts stating that specific property acquired during the marriage remains the sole property of one spouse.

Marital property, on the other hand, is property acquired during the course of the marriage. Separate property can become, at least in part, marital property if marital funds or efforts were used to maintain or improve the property during the marriage. Examples of this would be income earned during the marriage used to improve a home bought prior to the marriage or a spouse’s bookkeeping skills used to grow a business founded prior to the marriage. The spouse who contributed to the value increase is entitled to a portion of that once-separate property upon the divorce. [1]

How is marital property distributed in Maryland?

Maryland is considered an equitable property state, as opposed to a community property state. What this means is that the court can divvy up all marital property and debt in equitable shares, based upon various factors, and isn’t required to divide everything exactly down the middle. Some factors the court may consider include:

  • What each spouse contributed to the marriage, financially and otherwise;
  • The economic circumstances of each spouse;
  • How and when specific assets were acquired; and
  • Whether there was any marital misconduct on the part of one or both spouses.

If one spouse takes on a larger share of the marital debts, for example, he or she may be awarded a larger share of the assets to offset the debt. Though it’s not possible to absolutely predict what a court would determine in dividing up property and debts during a divorce, consulting with a licensed, experienced family law attorney can give you an idea of what the division may look like. [2]

I want to protect my assets as much as possible in the event of a divorce. What should I do?

Do consider putting into place a premarital or prenuptial agreement prior to your marriage. This document can protect any assets you may own now that may come into question in the event of a divorce.

Do use only nonmarital property to purchase other property you want considered nonmarital. For example, if you wish to sell a nonmarital car to purchase a plot of land that you alone will maintain and control, do not utilize any marital funds to make or maintain this purchase.

Do keep accurate, complete records of all nonmarital property and funds, and how they are used. If you can show a paper trail of money used only for nonmarital purchases, it is less likely to be considered marital property upon divorce.

Don’t deposit any income earned during the marriage into a nonmarital bank account. Keep the two separate.

Don’t assume that all property owned before marriage is automatically considered nonmarital. If you purchased a home prior to the marriage, then used marital funds to make repairs or improvements, a portion of the home’s value can be considered marital and subject to division.

Don’t open a joint bank account with nonmarital funds. Even if you plan to keep accurate records as to what funds are marital and what are nonmarital, it’s better to just create separate accounts. [3]

Experienced Divorce Attorney in Rockville, Maryland

Have questions about what property may be considered separate and what’s marital? Or have other questions related to divorce, child custody, or family law? Contact the Law Offices of Sandra Guzman-Salvado for an appointment with an experienced, compassionate family law attorney.

[1] ”Separate and Community Property During Marriage: Who Owns What?” NOLO.com
[2] “Maryland Marital Property FAQs,” DivorceNet.
[3] “Managing Marital Property – Do’s and Don’ts,” FindLaw.