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What is equitable distribution?
How a court divides marital property during your divorce.
If your divorce case goes to court in an equitable distribution state, a judge hears evidence and reviews many factors to determine how to divide your assets and debts — it’s not always 50/50. Over 40 states follow equitable distribution laws. And there are ways to get the most out of it.
What is equitable distribution?
Equitable distribution, also known as the equitable division of property, is a legal principle centered around how the property you’ve acquired during a marriage should be split up in a divorce. Instead of a 50/50 separation, courts weigh many factors when dividing your assets and debts.
Equitable distribution states
Over 40 states are equitable distribution states — also known as common law states — that recognize the equitable distribution of marital property. The one exception is Alaska, which gives spouses the option to follow equitable distribution or community property rules.
- New Hampshire
- New York
- New Jersey
- North Dakota
- North Carolina
- Rhode Island
- South Dakota
- South Carolina
- West Virginia
How is property divided?
Most divorcing couples try to come to an agreement about how to divvy up their property outside of court. You can use a mediator to help facilitate negotiations or hash it out over the kitchen table.
If you can’t agree and end up in court, a judge uses equitable distribution to guide property distribution. The court decision is final and out of your control. Going to court for equitable distribution is generally a last resort.
Nine factors taken into consideration with equitable distribution
Here are nine variables courts consider when determining what to give each spouse:
- Duration of the marriage
- Who has primary custody of the children
- Amount each spouse contributed to the combined marital property
- Each spouse’s expenses
- Each spouse’s earning potential
- Financial needs and liabilities of each spouse — both now and down the line
- Contributions to the family unit that didn’t earn money, such as raising the children or taking care of the home
- Age and health of each spouse
- Negative actions by each spouse, such as extramarital affairs, domestic violence or gambling debts
Premarital vs. marital property
Premarital property is yours to keep, whereas you and your spouse share marital property. Knowing the difference will help you determine which property to include in your divorce agreement.
|Premarital property||Martial property|
|Definition||Premarital property — also known as separate property — is the assets and debts that you had before marriage.||Marital property is everything you and your spouse acquired during the marriage, except if the property was a gift to one spouse, an inheritance from a third-party or explicitly excluded by a valid agreement.|
Equitable distribution vs. community property: What’s the difference?
Community property laws dictate that both spouses equally own all marital property. So in a divorce, you’ll split everything right down the middle.
On the other hand, equitable distribution divides the property fairly, depending on each spouse’s situation. There is no set rule governing what each spouse receives. For example, courts may split your marital property 40/60 or 70/30.
Community property states
The nine community property states include:
- New Mexico
How to get the most out of equitable distribution
If your divorce case goes to court, a judge splits your property according to equitable distribution laws. Here are a few tips to get the most out of equitable distribution:
- Do your homework. Get all the documentation to show which assets are separate property, such as the title of a car that you bought before marriage. You’ll also want to show how much you’ve financially contributed to the marital property and education and earning power of your spouse.
- Premarital or prenuptial agreements. If you have a prenup agreement, you’ll want to show the judge this legal contract, which spells out who gets what in a divorce.
- Evidence of “egregious” fault. Courts take into account extreme cases of fault when making equitable distribution decisions. For example, some states require the courts to consider whether domestic violence has occurred before awarding a settlement.
- Evidence of financial wrongdoing. You may be awarded a higher amount if you can prove that your spouse’s behavior impacted your shared finances or if your spouse has been hiding marital property.
Get help completing your divorce papers
Use an online divorce service to help fill out your divorce forms.
If you and your spouse can’t agree on how to divide your assets and debts, consider going to mediation to avoid court. If you still can’t agree and file for divorce in an equitable distribution state, a judge divides everything according to a variety of factors like your earning power, how much you contributed to your marital property and who has custody of your children.
Read our guide to getting divorced for more tips on how to protect your finances in a divorce.
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