Couples often have questions regarding the separation of their property and assets during a divorce proceeding. But they also need to consider the debts they and their spouse have, and how those debts will be split during the proceeding. A person’s liability for his or her spouse’s debts is varies depending on the state in which they were married. This post aims to explain the division of debt and property in New York.
The first key point about divorce and debt is that New York is an equitable distribution state. This means that the spouses’ property is split in an equitable way by them of by the court after reviewing what each spouse brought into the marriage and what they need post-divorce. That division is not necessarily “equal”. The emphasis in New York is on a “fair” division of property. Couples can work together to divide their property themselves as they see fit, often with the help of a divorce attorney in Queens. And if they cannot come to an agreement, the court can also divide the couple’s assets to resolve any property disputes between spouses.
The second key point to dividing property is understanding the meaning of marital property. Marital property constitutes property acquired during the marriage, while separate property includes property that was owned prior to the marriage, along with other assets like an inheritance or a personal gift. The definitions of marital and separate property can become more complicated in certain cases. For example, if one spouse owned a home prior to the marriage but the other spouse paid for renovation made to the home that increased its property value, the subsequent value increase can count as marital property.
The third point to know when dividing property during a divorce case is how to properly define the property and the marriage itself. Every divorce case is different, so it’s important for couples to understand how to properly categorize their property and to look into the factors that define their marriage. Types of property include “real” physical property like a home, “personal” property like clothing and jewelry, and “intangible” property like employment benefits and debts. And while some couples may not see debt as property, in the eyes of the court it has the same importance during the divorce proceeding as any other kind of property. The debt is categorized as either marital or personal, and then given to one or both spouses depending on certain factors. The court can review how long the marriage lasted and the spouses’ individual incomes. The court basically takes an approach that includes reviewing the past, present, and future of each spouse. It can look at how each spouse contributed to the accrual of marital assets and debts over time; their present circumstances, such as their employment and their custody of children; and their potential futures after the divorce, like lost health insurance.
After this review, the court can then go about diving the spouses’ marital property. If an asset is more complicated to divide, then the court may award a payment to one spouse to account for the uneven distribution. And although New York is a “no-fault” divorce state, a spouse can receive less marital property if it’s proven that he or she wasted martial assets.
Couples who have questions about their own property and how to properly split it during a divorce in Queens can work with an experienced bankruptcy lawyer in New York. The attorney will work with the couple, or with a single spouse to help defend their rights in court. You can find more information about the division of marital property in the New York Consolidated Statutes, Article 13 of Domestic Relations, Section 236.