Equitable Distribution of Marital Assets and marital debt NJ

Equitable Distribution of Marital Assets and marital debt NJ

Equitable distribution refers to how to divide property and debts that were incurred during the marriage between the parties under New Jersey divorce laws. Property and debts are not automatically divided 50/50, although they sometimes are. In dividing property, the judge will decide what is fair. If you have a substantial amount of property, you will probably want to consult with a lawyer about equitable distribution.

Normally, decisions about dividing property and debts cannot be changed after the judgment of divorce. In unusual cases, you may be able to get a change if you can show the court that there is a very good reason to change the decision.

Marital property can include:

Real property (a house or land).
Personal property (furniture or cars).
Severance pay, pensions (even though you may not receive the money until sometime in the future), and personal injury awards.
In deciding the issue of equitable distribution of marital property, the judge must do the following:

Decide what property is marital property.
Determine the value of each piece of property to be divided.
Determine how the property will be divided between the parties.
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Equitable Distribution of Marital Debt. Marital debt is defined as any debt brought about by either party between the date of their marriage and the filing of a divorce complaint. However, the court may not consider all debt acquired during that time to be marital debt. Debt that comes from purchasing items not related to the marriage, especially purchases made after a separation, may not be subject to equitable distribution. In that situation, the court will often decide that only the spouse who incurs that non-marital debt is responsible for it.

Warning: See a lawyer if you or your spouse has significant debt.

In deciding the issue of equitable distribution of marital debt, the judge must do the following:

Decide what debt is marital debt.
Decide how much debt each party will be responsible for.
Generally, if the parties incur debts during the marriage, they are both potentially responsible for it. However, it may be possible to prove that a debt belongs to only one party. The other party will have to show that the debt happened after the parties stopped living together, or that the debt is for items unrelated to the parties’ relationship.

Warning: If you are separated, and your spouse is authorized to use your credit card, you will probably want to cancel that authorization even before your divorce is final.

In deciding how to divide property and debts, the court must look at a number of factors, including:

The length of the marriage.
The age and physical and emotional health of both parties.
The income or property each party brought to the marriage.
The parties’ current economic circumstances.
Any written agreement between the parties concerning property distribution.
The custodial parent’s need to own or use the parties’ home and household items.
Expected future medical or educational costs for a spouse or child.
Any other factors the court finds relevant.


Special Considerations

Pensions and Retirement Accounts. If you or your spouse has a pension, you will probably want to consult a lawyer. To divide a pension, you will need to get a special evaluation. A pension expert must estimate the value of the pension at the time it will be paid and tell the court how to determine the amount of the pension that should go to the other spouse. The expert will prepare a Qualified Domestic Relations Order (QDRO), which will explain how to divide the pension. This order must be approved by the court. The portion of the pension that goes to the other spouse is usually based on the number of years the parties were married.



source http://www.lsnjlaw.org/english/family/divorce/divorcenj/divch1/index.cfm#ch1prep