Equitable Distribution - the Division of Marital Property
Equitable Distribution: Equitable distribution is often a complex issue which can involve the division of real estate, businesses, personal property, retirement accounts, bank accounts, debts and numerous other items. Our divorce and family law attorneys are highly experienced in the area of complex equitable distribution.
Property division can be both complex and contentious. At Hill Evans Jordan & Beatty, we will work diligently to ensure that your rights are protected during this process and that you receive a fair share of the marital estate. If you have an equitable distribution claim in Guilford County or in the surrounding area, you can count on our attorneys and staff to look after your best interests and fight for what you deserve.
Equitable distribution claims can be settled by a voluntary agreement or by filing a lawsuit in court. While it is generally cheaper and quicker to settle things voluntarily by agreement, you should still have an attorney review the proposed property division to ensure that all property is being accounted for and that everything is being appropriately divided. Once you sign the agreement, you lose any right you might have had to bring a lawsuit against your spouse for an equitable distribution of property.
To file an equitable distribution claim, you must be married to the person you are filing the claim against and you must be separated from that person. Your equitable distribution claim must be pending (filed) before your divorce is finalized. Note that the right to equitable distribution is lost if you have entered a valid separation or property settlement agreement that has already divided the marital assets and waived the right to an equitable distribution of property.
There are four steps in the equitable distribution process:
- valuation, and
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After identifying all property owned by one or both parties on the date of separation and all debts existing as of the date of separation, the identified property and debt is categorized as separate, marital, or divisible property. Separate property is property owned by one of the spouses before the date of marriage or property acquired by a spouse by gift or inheritance prior to the marriage or during the marriage from someone outside of the marriage. Separate property is not divided by the court during equitable distribution and is kept by the party who owned it before the marriage or acquired it individually during the marriage. Marital property is property acquired during the marriage by the labor of the marriage. Divisible property includes passive changes in the value of the marital property that occurs between the date of separation and the date of distribution. Marital and divisible property are divided during equitable distribution.
The value of the property may be established by documentation and information gathered by the parties, but appraisers and other experts can be brought in to assist if an asset is difficult to value, such as an interest in a business. The most common value assigned to marital property is the fair market value, which is frequently defined as the amount a willing buyer will pay a willing seller under willing circumstances. The valuation of an asset is made as of the date of the parties' separation; however, if an asset substantially appreciates or depreciates following the date of separation, this change in value can and should be considered when the final property division is made. If the parties cannot agree on the value of a marital asset, then the court will ultimately have to decide the correct value based on the evidence presented.
The final step in the equitable distribution process is the distribution of the assets and debts in an equitable manner. The court will equally divide the marital property unless the court determines that such a distribution would be inequitable. In determining whether or not an equal distribution is equitable, the court must consider several statutory factors. The statutory factors are quite detailed and cannot be stated briefly or applied without getting deeply into the specific facts of each case. The court has the discretion to determine how the marital property and debts are to be distributed to achieve an equitable distribution.
Post-separation property transfers between spouses are generally not subject to taxes by the Internal Revenue Service. However, if the transfers take place a year or more after the separation, there is a presumption that the transfer was not incident to the separation and consequently, the transfer becomes taxable. Guidance from experienced attorneys will help ensure that your property division is not subject to taxation.
We Can Help
At Hill Evans Jordan & Beatty, we understand the complexities of North Carolina’s Equitable Distribution laws and will work with you on your case to make sure your rights are protected. After your separation, dividing the property acquired during your marriage is necessary to begin the next phase of your life. As no two cases are alike, there is no cookie cutter approach to resolve property issues. We will listen to the particular facts of your situation and will work towards getting you the property that you desire. If you have an equitable distribution claim in Guilford County or in the surrounding area, call us today so we can help you move forward.
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