What Is Equitable Distribution And Divorce. How Does It Affect My Assets?
Divorce and Marital Propery Law Attorneys Monmouth and Ocean County NJ
Most couples who begin a divorce are unprepared and not even on the same page when they begin.
This lack of preparedness and readiness for a divorce causes divorces to deteriorate into competitive contests, especially when it comes to dividing assets.
Also known as equitable distribution, property division is the process of dividing property rights and obligations between spouses during a divorce. Property division may be agreed upon between the spouses through a property settlement or decided in court during the judicial process of divorce. The property division process is affected by state laws such as community property laws, definitions of marital contributions, etc.
New Jersey is an equitable distribution state, and only property acquired during the course of the marriage is subject to division following divorce. Some factors considered by New Jersey courts in a property division case include non-monetary contributions, contributions to a partner’s education, economic misconduct, and a list of other factors defined in New Jersey law.
Is there a set list of statutory factors for determining property division in the state of New Jersey?
New Jersey has a list of factors set by statute that specify what the court will use to determine a fair property division. Examples of factors that are often taken into consideration during property division cases include:
- Marital Fault – In states that allow at-fault divorces, the fault of one spouse may be used by the judge to justify a higher percentage to the injured spouse.
- Economic Misconduct – In New Jersey, spouses who wastefully or fraudulently spent marital assets may receive a lower percentage of the marital property.
- Income and Earning Capacity – The court may consider each spouse’s relative gains and earning capacity, which may be affected by factors such as age, education, and health. The spouse with lower economic prospects may receive a larger percentage of the estate.
- Educational Contributions – In New Jersey, spouses who contributed significantly to their partner’s education or earning capacity may receive a percentage of the marital property.
- Custody of Children – If one spouse has full custody of the couple’s children following the breakup, this may result in a higher likelihood of receiving a higher percentage of the estate or certain marital property pieces (like the family house).
What do the courts in the state of New Jersey consider in the decision of equitable distribution?
The standard of living established during the equitable distribution law in New Jersey is similar to most equitable distribution states. New Jersey law directs the Court to consider fourteen factors in determining an equitable, fair, and just division of assets. They are:
- The duration of the marriage.
- The age and physical and emotional health of the parties.
- The income or property brought to the marriage by each party.
- The standard of living established during the marriage.
- Any written agreement made by the parties before or during the marriage concerning an arrangement of property distribution.
- The economic circumstances of each party at the time the division of property become effective.
- The income and earning capacity of each party including education background, training, employment skills, work experience, length of absence from the job market, custodial responsibilities for children, and the time and expense necessary to acquire sufficient education or training to enable the party to become self-supporting at a standard of living reasonably comparable to that enjoyed during the marriage.
- The contribution by each party to the education, training, or earning power of the other.
- The contribution of each party to the acquisition, dissipation, preservation, depreciation, or appreciation in the amount or value of the marital property and the contribution of a party as a homemaker.
- The tax consequences of the proposed distribution to each party.
- The present value of the property.
- The need of a parent who has physical custody of a child to own or occupy the marital residence and to use or own the household effects.
- The debts and liabilities of the parties.
- The need for creation, now or in the future, of a trust fund to secure reasonably foreseeable medical or educational costs for a spouse or children.
Does New Jersey consider a spouse’s economic misconduct in property division?
New Jersey law allows courts to consider the economic misconduct of a spouse as a factor in determining equitable property division. Economic misconduct generally means dissipation of assets, which is the legal term for the wasting or losing marital funds or assets by a spouse through means like excessive spending, gambling, fraud, etc.
If a spouse is found to have dissipated marital funds in a way that injured the other spouse, the court may take punitive or restorative action by awarding a higher percentage of the divided property to the injured spouse.
Can a pre-nuptial agreement affect property division in New Jersey?
A prenuptial agreement, or prenup, is a binding, legal contract signed by both spouses before getting married in New Jersey. A prenup containing a property division agreement can take precedence over New Jersey’s property division laws by establishing what is considered separate vs. marital property and agreeing on how finances will be structured during the marriage and divided in the event of a divorce.
The existence of a valid prenuptial agreement can prevent a New Jersey court from having full reign to determine how assets are divided between the spouses and instead allow them to be divided in a way agreed to by both spouses before the event.
CONTACT AN OCEAN COUNTY, NJ EQUITABLE DISTRIBUTION ATTORNEY TODAY
Divorce is tough, and determining who gets what does not make it any easier. At Bronzino Law Firm, LLC, our job is to make the process as smooth as possible. Our goal is to help couples and families restructure, rather than destroy, their relationships through our legal and collaborative divorce services. We guide our clients to the best possible outcomes, both emotionally and financially, in the face of life’s most stressful experience. Contact us by calling (732) 812-3102.