WHAT ASSETS ARE GOING TO BE A PART OF THE DIVORCE?
The Commonwealth of Virginia has instituted laws that require courts to equitably divide marital assets in a divorce. Property that is part of equitable distribution can range from large to small, and everything in between.
Virginia classifies property into three categories: marital, separate, and hybrid. As part of the property division all assets from each category will be listed, given an approximate value and properly designated. Items such as kitchenware, tools, jewelry, electronics, cars, homes, real estate and businesses may be divided between a couple. Financial assets such as investments, retirement accounts and even debt will also play a role in the division of property.
WHAT IS THE DIFFERENCE BETWEEN MARITAL, SEPARATE, AND HYBRID PROPERTIES?
Marital property includes assets acquired during the marriage. Household items, joint bank accounts, funds accumulated into investments/retirement during the marriage, cars and homes titled to both spouses are all examples of marital property.
Separate property includes any assets attained either before the marriage, after the parties separate, and assets inherited or gifted to one spouse during the marriage from a source outside the marriage. An investment made prior to the marriage or an inheritance specified to one spouse is generally considered separate property in Virginia.
Hybrid property includes assets that may have once been separate, but over time has generated income, increased in value and/or is mixed with marital property over time. An example would be land that one spouse owned prior to the marriage, where the couple works together to build a home on the land, increasing the value of the property. Another would be a 401(k) plan that included amounts deposited both before and during the marriage.
WHAT IS A SEPARATION AND PROPERTY SETTLEMENT AGREEMENT?
This is a contract in writing, signed and notarized by both parties, in which all of the issues of the marriage are agreed including duties and obligations in reference to children, if any, (custody, visitation (also known as “parenting time”), child support, health insurance, etc.), debts, distribution of real estate, personal property, whether tangible assets (household items, furniture, cars, etc.) or intangible assets (securities), retirement accounts, other financial accounts and pensions. The second the Agreement is signed you have basically written your own Divorce Decree or Order. (Rather than having a judge do it for you!) The only issues that can be modified, if circumstances change, are those having to do with the children, such as custody, visitation and child support, as well as spousal support (if not waived).
HOW ARE THE VALUES OF PROPERTY DETERMINED?
Asset value can be one of the most crucial components of a divorce. Depending on the circumstances, different valuation dates may be used. The valuation of real property, closely held businesses, and significant personal property like artwork or vehicles may present challenges. A divorce attorney with experience and a support team of professionals can help determine the proper value of assets in order to proceed with equitable distribution. Your attorney may engage the services of qualified appraisers, accountants, or other professionals to help determine the value of assets.
WHO WILL DECIDE HOW PROPERTY IS DIVIDED?
The nature of the divorce will drive who essentially controls property division. In some circumstances the couple may make many or all asset decisions themselves, others find that the use of legal counsel and mediation are in their best interests. Other cases require the court to decide how property will be divided based on numerous factors.
WHAT FACTORS WILL EFFECT PROPERTY DIVISION IN VIRGINIA?
While Virginia strives for equitable distribution of marital property, this does not mean all property is divided 50-50 between the divorcing couple. The court will take into account:
The contributions, monetary and non-monetary, of each party to the well-being of the family
The contributions, monetary and non-monetary, of each party in the acquisition and care and maintenance of such marital property of the parties
The duration of the marriage
The ages and physical and mental condition of the parties
The circumstances and factors which contributed to the dissolution of the marriage
How and when specific items of such marital property were acquired
The debts and liabilities of each spouse, the basis for such debts and liabilities, and the property which may serve as security for such debts and liabilities
The liquid or non-liquid character of all marital property
The tax consequences to each party
The use or expenditure of marital property by either of the parties for a non-marital separate purpose or the dissipation of such funds, when such was done in anticipation of divorce or separation or after the last separation of the parties
Tax issues and debt will also play a part in property division
Take the time on your own to learn about legal matters in Virginia. This should never be used as a substitute for the advice of experienced counsel; this education empowers you and can help frame your discussions with your attorney.
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