Asset Division FAQ
WHO GETS WHAT AND WHY IN ASSET DIVISION
What happens to our assets when the marriage dissolves? As experienced divorce attorneys, we understand that you have questions that need answers. Here are the most commonly asked questions and their answers.
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HOW ARE ASSETS DIVIDED IN A DIVORCE?
Most of the property in a marriage is considered marital, or owned by both parties. There are exceptions to this, however. Whichever property was brought into the marriage and was understood to be individual (for example, a motorcycle, or a painting) is typically kept that way. Anything one spouse inherits, attains in an injury lawsuit or receives as a personal gift is not marital. A judge’s duty is to divide assets equitably. This does not mean equally. The way assets and property is divided depends on the length of the marriage, how and what each spouse contributed and the needs of each spouse, among other issues. We will assess your situation and tell you what can be reasonably expected and the steps to take to protect what is rightfully yours.
WHAT HAPPENS TO DEBTS IN A DIVORCE?
Typically, debts are shared. There are many things to consider when it comes to debt, however, especially how to prevent creditors from seeking one spouse to repay all debts should the other spouse declare bankruptcy, for example. We will assess your debt situation and advise you on the best way to protect yourself, your children and your financial future. If one party has debts and the marriage is annulled, then those debts typically belong only to the person who created them.
WHAT HAPPENS TO THE MARITAL HOME?
Generally, a shared home is considered jointly owned, or “marital” property. However, if one spouse entered the marriage with their name only on the house and with the understanding that the house was their individual property, then the house will not likely be considered marital and the person will retain full ownership. If the house was purchased after the marriage, it will likely be perceived by the court as marital property. Paying a mortgage does not ensure that the house is marital. As every situation is slightly different, we can advise you on your particular asset division matter.
WHAT HAPPENS TO A FAMILY-OWNED BUSINESS IN A DIVORCE?
It all depends on the details of the business. In some cases, one spouse entered the marriage with a business and was the sole participant in the day-to-day operations, growth and success of that business. In other cases, a business was started after the marriage and both spouses contributed to the business’s success. In cases where it can be shown that both spouses had a role in the operation and success of the business, then it is likely that the business will be characterized as marital. In some cases, the best way to divide a business is for one spouse to “buy out” the other spouse. A buyout is typically not allowed in businesses that offer professional, licensed services and where only one spouse is licensed. We can do a detailed assessment and advise you as to the nature of the business in question. We can then offer strategies to protect your interests moving forward.
HOW ARE RETIREMENT ACCOUNTS DIVIDED?
If the accounts were opened during the marriage, they are considered marital property. Likewise if contributions were made during the marriage. IRAs, 401(k)s and pensions typically require a qualified domestic relations order (QDRO) from the court to be divided after the divorce is final. How these assets are divided is dependent on a number of variables, the most impactful being the length of the marriage.
WHAT IF MY SPOUSE IS HIDING ASSETS?
It is illegal to hide assets during a divorce. There is always a paper trail, even with offshore accounts, straw men and shell corporations. Forensic accountants are specially trained to locate hidden funds. As experienced divorce attorneys, we will loop in these experts when warranted to ensure that all assets are accounted for.
WHAT HAPPENS IN CASES WHERE ONE SPOUSE WAS THE PRIMARY INCOME EARNER?
Here again, it depends on many variables such as the length of the marriage, if there are children, and why one spouse worked and the other did not. Assets are to be divided equitably; this means that, for example, if one spouse worked for 20 years and the other stayed home to raise the children and take care of the home, then it’s likely that the court will award the stay-at-home spouse monetary monthly support as well as a portion of the retirement funds or pension. We will review the details of your marriage and counsel you as to your options and the best way to proceed.
GET THE ANSWERS AND GUIDANCE YOU NEED
Your financial security and future are of the utmost importance. We can help you understand what your obligations and rights are. Call 312-667-7706 to set up a free and confidential initial meeting. You can also send us a query via this website contact email. Conveniently located on Chicago’s North Side, we represent clients throughout the greater Chicago area.