How Assets are Divided in New York
When couples decide to divorce, it is natural for thoughts to turn to what each person will keep or retain after the dissolution is final. Each state determines how it will divide assets in a divorce, and New York uses an equitable distribution system. But what does this mean?
Property is classified into two categories in New York. Separate property are those assets a person owns before marriage, and inheritances and gifts are usually classified under the same category. Marital property is the assets a couple acquires from the inception of marriage until filing a divorce action.
It is critical to note that separate properties may become marital property if inheritances, gifted money, or a separate asset such as a property was put into an account shared by a spouse or if the spouse’s name was added to a deed. Commingling refers to the combining or mixing of the two types of property. Then, a judge may view the asset as a property to be equitably divided.
What Equitable Division is Not
The term can be deceiving, but equitable does mean equal. A judge does not evenly split assets such as homes, automobiles, or household items. It does mean that each partner will receive a portion as close to half as possible of the equity of the combined assets.
There are essential considerations to make when determining equitable distribution that are more than the assets a couple owns. It is always beneficial when spouses can work together to decide equitable distribution, but seeking guidance and ensuring the support of a New York equitable distribution attorney is recommended to ensure you are properly compensated. Some of the considerations include:
- The loss of pension, inheritance rights, and health insurance after divorce
- If spousal maintenance is rewarded
- One spouse’s contribution to the earning potential of the other
- Tax consequences
- The duration of the marriage, including the health and age of each spouse at the time of divorce
The equitable division of assets in any marriage is complex, but high net-worth divorces will require more time to navigate and demand assistance from an attorney experienced in high net-worth divorce cases.
What Happens to Our Home?
One of the most frightening aspects of divorce can be the loss of a marital home. The current financial market has made securing an affordable place to live even more challenging. If the house was purchased before the marriage, it may still be considered separate property unless a spouse’s name was added to the title or deed.
Additionally, any improvements or contributions a spouse may have made to a home considered separate property will be considered by a judge and may be viewed now as marital property.
Other Assets Considered as Marital Property
Other than the home, additional assets considered marital property include:
- Household items
- Automobiles or other transportation
- Other properties, such as a vacation home or timeshares
- Financial assets, such as bank accounts, investments, retirement savings, social security benefits
- Corporate rewards
- Frequent flier miles
This list is not a complete compilation of marital assets subject to equitable division. For example, when partners own a business and work together, each partner’s interest in a company is considered. Depending on each spouse’s interest in the business, a partner may claim only a portion of the equity if they are less invested, while both spouses sharing an equal interest in the business may require one spouse to buy out the other spouse’s equity or the company may need to be sold for an equitable division.
Ensuring an Equitable Division of Assets in a New York Divorce
Every marriage produces unique assets, and equitable division looks different in each divorce. Ensure your best interests are considered by working with a New York divorce attorney who fiercely negotiates for her clients. Vivien I. Stark possesses expert knowledge and skills in asset valuation and distribution, benefitting her clients with over 30 years of marital and family law.