Equitable distribution is the term used for the apportioning, upon the dissolution of a marriage, the property held jointly within a marriage, by both spouses. Property may be referred to as “joint” or “marital” property.
Marital property is any money, bank accounts, real estate, businesses, 401(k) or other retirement accounts, jewelry, college degrees, or any other assets acquired by one spouse, or both, during the marriage.
The opposite of marital property is separate property. Separate property is considered inherited property, assets or property acquired by either spouse before marriage, gifts by a third party, and personal injury awards maintained separately during the marriage.
Interestingly, a business, for example, begun by one party prior to the marriage might be considered separate property, but the increase in value of the business during the marriage may be considered joint property.
It’s easy to see from these definitions alone that equitable distribution is anything but cut-and-dry. Judges and courts often have to consider a great many factors before making a final decision regarding the distribution of property to divorcing partners that is both equitable and fair.
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It is important to remember that equitable distribution does not necessarily mean “equal” distribution. 50/50 might be equitable in one instance, or seem so to one spouse, while 80/20 might be equitable to another. The judge’s decision will almost certainly never please both spouses in most cases.
Nevertheless, judges have to use guidelines and make decisions when the parties can’t. Some of the guidelines commonly used are:
• Duration of the marriage (short-term or longer-term)
• Age and health of the parties
• Contributions each party has made
• Present value of the asset or property in question
• Debts and liabilities of the marriage partners
• Tax consequences of a proposed distribution
There are a number of other guidelines, but this list proves that judges can have a tough time deciding who gets what in a divorce, especially a bitterly contested one. Luckily, qualified divorce attorneys can take a lot of guesswork out of this process by crafting a “Statement of Proposed Disposition”, and submitting it to the Court and to the other side early in a divorce proceeding. Prepared skillfully, this document can set forth a client’s needs and wish-list, and also help set the terms for the negotiations ahead.
The law firm of Kyle J. Farquhar is highly adept at making sure our clients’ financial rights, property, and standard of living are preserved to the greatest extent possible during divorce negotiations.
California Equitable Distribution Factors