Equitable distribution is the process by which marital assets and debts are divided between the parties during divorce. Any asset or debt acquired during the marriage is presumptively eligible for equitable distribution, although there are certain ways that property may be excluded, including property acquired by inheritance, gift, and property excluded by a prenuptial agreement. Court-determined equitable distribution may also be avoided by both parties signing a marriage settlement agreement, in which the parties themselves are able to agree on the distribution of marital property.
When a court is responsible for dividing the property, there are certain factors that the court must consider by statute. However, the court is free to weigh the evidence in any way that it chooses, placing more weight on certain factors than on others. Here are some of the factors that the court is required to consider:
1. Length of marriage: The length of the time that the parties have been married plays into what the purpose of equitable distribution should be. In the case of a very short marriage, in which the parties did not invest very much in their married lives or did not combine their assets, then the court is more likely to divide the property in such a way as to return the parties to their circumstances before the marriage. In the case of a longer marriage, in which one spouse may have deferred education or employment opportunities to raise a family, and/or in which the parties finances have been combined, then the court will likely attempt to put both parties in similar financial positions.
2. Age, health, station, income, employability, etc.: these factors all go to the potential for remunerative employment and the ability to provide for themselves after the divorce. If parties are in similar financial circumstances and of similar age, then the distribution will likely be more even. If one party relinquished employment opportunities for the family and are older and unlikely to earn a remunerative job, then they will likely receive a greater proportion of marital assets.
3. Contribution to the marital enterprise: several statutory factors are related to contribution to the marriage. The court will take into account a party who worked to support the family, as well as the spouse who stayed at home to care for the children. The decision of one spouse to support the education of the other spouse by working can also be considered as well.
4. Tax Consequences: Any transfer costs or other taxes associated with a marital asset have to be taken into account.
Our Beaver County equitable distribution lawyers have the experience and the knowledge to advise you during this complicated process. Contact our team to discuss your case today!