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Equitable Distribution During Divorce in Orlando
During a divorce your assets and liabilities will be equitably divided. While many people think, this means splitting each of the assets in half, typically the analysis is a bit more complex. Certain assets cannot be divided or it doesn’t make sense, economically to divide them. In those cases, certain assets or liabilities must be offset against others. For example, if the Wife wants to keep the home, which has $100,000 in equity, then she will need to pay the Husband $50,000 from some other asset. The same is true for liabilities. For example, if the Husband were to keep $50,000 in credit card debt, then the Wife would owe the Husband $25,000 from some other asset. Typically, an equitable distribution worksheet is created to account for all of the assets and liabilities. At the DeWitt Law Firm, our family law attorneys have extensive experience handling complex financial issues, which impact equitable distribution in divorces.
Is the asset or liability marital?
Generally, any asset accumulated during the marriage as a result of the efforts expended during the marriage is considered marital and subject to distribution regardless of whose name it is in. However, assets that were acquired prior to the marriage may also have a marital component, if marital funds or efforts were used to increase the value. Additionally, if a premarital asset was comingled with a martial asset, the entire asset may become marital. Any liability incurred during the marriage is marital, regardless of whose name it is in.
What date is used to value the assets or liabilities?
When valuing an asset or liability the court has the option to choose either (1) the date of separation; (2) the date of filing the Petition for Dissolution of Marriage; or (3) the date the Final Judgment is entered and the divorce is finalized. The trial judge is to utilize the date that he or she believes is just given the circumstances. However, the judge can choose a different date for each of the individual assets and liabilities.
How do you value the asset or liability?
The method for valuing the asset will depend on the type of asset. Obviously, assets such as bank accounts are fairly straight forward. However, certain assets can be more complex. For example, if the Husband had a Pension Plan where 4 years of his pensions are deemed non-marital, a coverture fraction may need to be calculated to determine the marital portion of the pension. Alternatively, if there is a retirement account such as an IRA or 401K where there is a pre-marital component, the pre-marital component plus any gains or losses must be calculated to determine the total non-marital portion.