How is property divided in a divorce?
Massachusetts is an equitable distribution state. Marital property encompasses all of the property owned by either spouse, including gifts and inheritances. Although what is considered marital property is very broad, it is divided between spouses equitably, meaning according to what each deserves. Equitable division is based on many factors, set out by statute, which the Court must consider, such as the length of the marriage, each spouses homemaking and financial contributions to the marriage, each spouses occupation and ability to earn income, and the conduct of the parties during the marriage. G.L. c. 208, 34.
If the parties cannot agree on a property settlement, the Court will determine whether the assets owned by the parties are marital or separate property. As a general rule, all assets acquired during a marriage (marital property) are considered the joint effort of the parties, subject to equal division unless the Court decides for some reason that an equal division would not be fair. Assets that were acquired prior to the marriage, as well as other types of assets such as an inheritance, personal injury settlement, or a gift solely to one of the parties, are considered separate property which generally is not subject to division. This is a very complex subject. Assets to be divided in a divorce often include real estate, professional practices or other businesses, household goods and furnishings, motor vehicles, bank accounts, stocks, bonds, other investment accounts, pensions and retirement accounts.
According to the divorce source, before the court can divide community property, the property needs to be identified and valued. Each spouse is qualified to express an opinion as to the value of property. The value to be established at the time of divorce should be the “fair market value”. Often divorcing couples believe each one is entitled to equal shares of the community estate. However, Texas courts award property in a just manner. The courts can use many factors when awarding property such as the following: fault in the break-up of the marriage; child custody; age of the parties; and the needs of the parties, this being the Court’s discretion utilizing the just and right doctrine. When real estate is owned outside of Texas, the courts have no authority to divide the property. Unless a Texas court can subject the parties to jurisdiction, the real estate property sometimes will not be divided upon the Final Decree of Divorce.
Courts divide property between spouses using two different concepts: Community Property and Equitable Distribution. The laws in each state vary as to the factors it uses to determine the final property division. Keep in mind, equitable does not mean equal. The goal is to award each spouse a percentage of the total value of the assets. Generally, states that use the Community Property system classify all the property as either community property or separate property. Community property is owned equally by the spouses and divided equally at divorce. Separate property is kept by the spouse who owns it. The community property states are: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. States using the equitable distribution system consider all the assets and earnings accumulated during marriage to be marital property and divide them fairly at divorce.
