Who Owns What? An Overview of Division of Property at Divorce
No couple enters marriage with the expectation of getting a divorce; however, life has a way of offering the unexpected. Although determining the exact national divorce rate is difficult, a large number of marriages will come to an end. One particular hot button issue is how to divide the property owned by both spouses.
Spouses who agree about how the marital property should be divided may enter into what's known as a “Marital Settlement Agreement (MSA).” The MSA must be in writing. It is wise to use an attorney to draft the MSA, especially in instances involving complex financial issues. If a couple cannot agree, a court will decide how the marital property is to be divided.
Marital or Non-Marital Property?
The court will classify all property owned by the spouses as either marital or non-marital property. Spouses will usually keep their non-marital property, while the court will equitably divide the marital property.
Under Illinois law, to determine how marital property is to be divided between spouses, courts apply a system of property division known as “equitable distribution.” The goal of equitable distribution is to fairly divide the marital assets between the two parties. Courts will give consideration to both monetary and nonmonetary contributions made during the course of the marriage.
Determining Property Value
The court will determine a value for the property being divided. To accomplish this, the court will rely on fair market value. The fair market value is the price the property would sell for in the current marketplace. The court may determine the fair market price based on stipulations of the parties or expert testimony. It is important to note that used items have a lower fair market value than when they were brand new. It is also important note that some specialty items may be difficult to value. Couples may need to consult professional appraisers.
Concealment or Waste
When dividing the marital property, the court will also consider whether any spouse has hid, transferred, and/or destroyed marital property (e.g., in an effort to prevent the property from being divided). In such instances, the court may give the “innocent” spouse a greater share of the marital property to compensate for the dissipation, concealment or waste.
In addition to assets, the court will divide debts owed by the couple. To determine how the debts will be divided, the court will rely on a number of factors, including the debts of each spouse, the basis for the debts, and the properties used to secure the debts.
If you are considering a divorce, and have questions about how your property may be divided by a court of law, please contact an attorney Mirabella, Kincaid, Frederick & Mirabella, LLC. Our divorce attorneys are dedicated to helping spouses through this difficult time. Contact us today to schedule your free consultation.