The concept of property division can seem simple and straightforward. A couple decides to divorce, and they must divide their property. Something that sounds so easy in theory, however can be challenging in practice.
Dividing assets is one of the key issues in a divorce, and the outcome can have a significant impact on your financial future. There are some key terms and North Carolina laws you should know about how property is divided as part of a divorce.
North Carolina law states that property must be divided equitably. This is not always as simple as splitting the property evenly between the two parties. The division must be fair and just, and in some cases equitable distribution may, in fact, be unequal. Courts have discretion when dividing property, which is why it is important to advocate for a just result that you can live with.
No, property isn’t always divided 50/50. Equitable does not necessarily mean equal. Dividing property involves an award of real estate, retirement assets, personal property, art and collectibles and other types of assets. One party may have a nonmarital interest in certain property. Also, not all property is able to be easily divided. Some retirement accounts have different implications when divided and awarded. It is important to take each item and approach the division appropriately as well as consider it in the big picture.
Marital property generally includes those assets or debts acquired during the marriage. Separate property is generally those assets and debts acquired prior to marriage or as the result of a gift or bequest. As with most situations, there are exceptions to these rules, however. Some property, including gifts and inheritances, may be marital, separate or a little of both. Like equitable distribution, marital and separate property isn’t black and white, which is why an attorney can help you understand your specific circumstances.
Part of what makes property division so complicated is the mix of assets a couple owns. You may own real estate or a business or both. You may have retirement and investment accounts or even a pension. Each of these items is under consideration during property division, and the more complicated your assets are the more challenging asset division can be.
If you have a clear picture of your portfolio and a basic understanding of property division, you’ll be at a good starting point to work toward a resolution.