You hear it all the time: “If I get divorced, my wife or husband will get half of everything,” or “if you get married, half of everything you own will be taken by your spouse if you divorce.” In reality, it does not work that way, at least not in New Jersey.
Two Ways of Dividing Property
There are two ways of dividing up property after a divorce. The first way seems easiest, but may not be as fair, and it is used by only a minority of states. If you live in Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington State or Wisconsin, you live in a community property state.
Community property laws are pretty black and white, which makes them easier to understand when you get divorced. Simply put, property is either marital property, subject to division, or pre-marital property, which is the property of whatever spouse owned that property before the marriage.
If property is considered marital, in a community property state, it is divided equally between the spouses. The court does not look at contributions, or what is fair. The presumption is that both parties equally own marital property, and thus, the property is divided between them both 50-50.
New Jersey’s Equitable Distribution Laws
Equitable distribution (used in New Jersey divorces) works differently. With equitable distribution, the court still will determine what property is marital and which is not marital. But here, marital property can be divided equally, but does not have to be. Instead, the court will look at what is fair, and divide it based on fairness, as opposed to blindly just dividing property in half.
The property may not be divided equally—in fact, one spouse may not get any part of property, or may get a much smaller share of the property.
This is fairer in that property is divided based on each party’s contributions to the property, and its value. However, the negative is that it can lead to more litigation, as parties have to present evidence to present to the judge as to why they should get however much they feel they are entitled to of the marital property.
More Flexibility
Another benefit of equitable distribution is the ability for s spouse to pay out or buy out the other spouse’s interest in property, allowing a spouse to keep property. For example, if a business is worth $1 million, in a community property state, one spouse would have to pay the other $500,000 to “buy out” his or her share of the business.
Under equitable property laws, if a spouse is only entitled to, for example, $100,000 of that money, that may be an easier amount for the spouse that wants to keep the business to pay to the other spouse to compensate him or her for their shares in the business.
In the dark about what will happen to your property if you get divorced? Don’t wonder, get answers. Contact our New Jersey family law attorneys at The Law Office of Agnes Rybar LLC for help today.
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