How to Determine When Assets and Liabilities are Marital or Nonmarital
At the time that a couple believes that their marriage is irretrievably broken, the couple will begin the process of equitable distribution of assets and liabilities. In other words, this is the division of property where individual and marital property is assigned and divided between each party so that both individuals within the couple may start their lives separately. The most important part of the equitable distribution is to determine what exactly is individual property and what constitutes marital property. In a prenuptial or postnuptial agreement, this may be a very easy task, especially where the total assets and liabilities has already been divided pursuant to the agreement. It gets more tricky in situations in which the property was held together by the married couple or where the couple both engaged in activities that helped to increase the value of the marital assets. If you and your spouse are considering a divorce, it is important to speak with an experienced divorce attorney who can help determine which assets and liabilities are most likely to be considered marital and which are more likely to be considered non-marital.When are Assets/Liabilities Considered Marital?
Florida law determines that marital assets and liabilities are:
Any assets or liabilities that were acquired or incurred during the duration of the marriage, by either spouse as individuals or together as a couple;
Interspousal gifts that were given throughout the marriage;
Benefits, funds, and rights that are either vested or nonvested that were acquired through the marriage such as retirement, annuities, insurance plans, pensions, among other funds.
All real property as long as the couple held the property together as tenants by the entireties. If a property was acquired before the marriage, it may still be considered a marital asset, especially where the other spouse aided in the improvement of the property that led to appreciated value.
The most important aspect when determining marital assets and liabilities involves who accrued/incurred the assets/liabilities, when as it relates to the marriage (before or during), and the extent in which each spouse aided in improving the property so as to increase its value. For interspousal gifts, the burden of proof to show that the item was not a gift must be proven by clear and convincing evidence.How to Determine Nonmarital Assets and Liabilities
For nonmarital assets/liabilities, the threshold for these items involve ownership by either party prior to the marriage, how the party received the property, and how the property was used during the marriage. The following are other factors to consider:
Whether the assets were acquired as gifts or if one party received the assets as a beneficiary pursuant to a will, trust, or other inheritable arrangement;
Whether the assets (or income derived by the assets) were ever considered or used as a marital asset. Florida considers most inheritances or family gifts to be non-marital assets. However, if the non-beneficiary spouse had a relationship with the inheritance or family gift that made it clear it was considered by both parties as a shared, marital asset, the asset may be considered marital.
Florida also ensures that individuals are not stuck with any liabilities that was incurred as a result of forgery or unauthorized signature. In the event, that one spouse incurs debt or a liability without knowledge by the other spouse, this will not be considered a shared, marital liability for fairness purposes.
Finally it is important to note that in Florida, there is a presumption that all assets and liabilities that were acquired or incurred after the marriage are marital. If this is not the case, it is important to speak with an attorney. Please contact West Palm Beach family law attorney William Wallshein for a confidential consultation.