Even under amicable circumstances, dividing property during a divorce can be complicated and stressful, especially if the property carries a significant amount of assets. Some examples of this include a home, commercial properties, retirement or investment accounts, insurance policies, business ownership and professional licenses or practices.
When considering how to divide your property, contemplate your long-term financial health. In the long run, a hoarding mentality won’t benefit you or your future ex.
So what constitutes separate and marital property? Some of the specifics change from state to state, but in general terms, separate and marital property include the following.
- Any property owned solely by either spouse prior to getting married
- An inheritance received by either partner before or after the marriage was legal
- Any gift received by a separate spouse on behalf of a third-party
- Any financial settlement received for pain and suffering in a personal injury case
When acquiring these kinds of assets, understand that if you join them with your spouse (like adding your spouse as a co-owner of your commercial real estate property or depositing your inheritance into a joint account), that property accounts as marital property.
Though state laws can differ, almost all property accumulated during marriage is counted as marital property, including the following:
- IRA and other forms of retirement plans
- Deferred compensation
- Investments, stock options and restricted stocks
- Life insurance policies
- Brokerage and bank accounts
- Business ownership
- Professional practices
- Professional licenses
- Real Estate ownership
- Business partnership agreements
- Acquired art or any other purchases
- Tax refunds
Wisconsin’s community property law
For Wisconsin residents, understand that Wisconsin is a community property state. This means that any property acquired or income gained during the length of your marriage is marital property. Also, in community property states, courts often divide all marital property equally, but in some situations, the court will adjust equal distribution after considering the following elements:
- The length of the marriage
- Separate property
- The mental and physical health of each spouse
- What each spouse contributed to the marriage (while also considering the value homemaking and child care services)
- The earning potential of each spouse (based on education level, job history and employment opportunities)
Familiarize yourself with these and further details regarding property division during a divorce to give yourself an advantage when the time comes.