One of the most common issues spouses will face upon divorce is that of property division. While spouses can make an out-of-court agreement as to what will be divided and how it will be divided, if it comes to the court, then the outcome may not be as the parties wish. Generally, the court will decide how to divide property between spouses based on Florida law, but even then, as with any family law matter, the outcome depends entirely on the facts of the case. Even the outcome of inheritances can change depending on how the parties handle the inheritance.
Equitable Distribution
In Florida, matters of property division in divorce are regulated under Florida Statute Section 61.075. Under this law, courts are required to begin with the premise that the distribution of marital property should be equal between the parties. While this is the starting premise, there are exceptions, and a court may allow an unequal distribution if found necessary as supported by relevant factors, including, but not limited to:
- The economic circumstances of the parties
- The duration of the marriage
- Any interruption of personal careers or educational opportunities of either party
- The intentional waste, dissipation, depletion, or destruction of marital assets after the filing of the petition or within two years prior to the filing of the petition, and
- Any other factors necessary to do equity and justice between the parties.
That being said, the court may not divide any property owned by the spouses, the court may only divide property that is classified as marital property. The other type of property, which is personal property, remains as the separate property of the spouse who owns it, unless otherwise stated in a separation agreement. What makes up the categories of marital and personal property, however, can be a complex matter for all involved.
Marital Property
As its name suggests, marital property is any property that is owned during the duration of the marriage. While this can include the more typical forms of property, such as the marital home or shared bank accounts, it can also include other forms of property, such as:
- Credit card debts
- Mortgages
- Businesses
- Pensions
- Personal savings accounts, and
- Medical bills.
The uniting factor between all of these forms of property is that they are all used in furtherance of the marriage. For example, if both parties earn a certain amount of money through work, that money will generally be regarded as marital property even though the money was earned individually. Similarly, real estate will be regarded as marital property, even if owned by one spouse, if it was used in furtherance of the marriage. As with any other matter, however, there are limits to what can qualify as marital property.
Personal Property
Whereas marital property covers property obtained during the time of the marriage, personal property can cover a very different range of property. Under Section 61.075, personal property includes property acquired before the marriage, assets acquired separately by either party by non-interspousal gift, bequest, devise, or descent, and all income derived from personal property. In addition, parties can agree to exclude specific types of property from being classified as marital property under a separation agreement.
Inheritance
Under Florida law, any property obtained through an inheritance may be considered as personal property. It is important to note, however, that this is only the case if the bequest is non-interspousal. This means that the inheritance can only be given to one spouse. If it is bequeathed to both spouses, then the inheritance will be classified as marital property. In addition, if a party co-mingles the inheritance with marital property, or if the spouse uses the inheritance in furtherance of the marriage, then the inheritance will be transmuted into marital property. As inheritances are not limited only to monetary gains, however, the matter of inheritances can become even more complex.
Co-mingling
The matter of co-mingling can be a subtle issue that many people may not think about. During the duration of a marriage, spouses may not think twice about sharing their good fortune with their spouse. Doing so, however, will transmute the inheritance from personal property to marital property.
Co-mingling an inheritance can have a fairly drastic effect on property. For example, if a spouse’s wealthy uncle passes away and leaves $1,000,000 to only that spouse, then that inheritance will remain the personal property of that spouse. If, on the other hand, that spouse deposits that money into a joint bank account shared by the other spouse, then that inheritance will be transmuted into marital property on account of the co-mingling with marital funds. Similarly, if the wealthy uncle leaves the money to both spouses as opposed to only one, then the inheritance will also be considered to be marital property. These matters can extend to inheritances that involve physical property and real estate as well. For example, if a party receives a beach house through a non-interspousal inheritance, then that party would own the beach house as separate property, as well as any rent gained through the beach house if the spouse chooses to rent out the space. If the spouse uses marital funds to repair or maintain the house, however, then it is likely that the
It is important to note that, while it is important to protect one’s interests, it is also important to not let personal property divide a perfectly good marriage. In any marriage, it is up to each spouse to decide how to handle their issues as they arise, and consulting with an attorney on these matters can help provide a clearer look at the outcomes and consequences of certain actions.