What is Marital Property?
Once you have decided to divorce, one of the first things you may think about is property division. Before division of assets and debts can be determined, you first must determine what is, or is not, marital property. Some common misperceptions are (1) if a piece of property is titled in one spouse’s name, it will go to that spouse and the other spouse has no claim to that property; (2) if property was acquired prior to the marriage, it is not marital property; (3) if property is acquired by gift or inheritance, it is excluded from marital property. In fact, Indiana considers all property in a “one pot” theory when dividing marital property.
In an action for dissolution of marriage the court shall divide the property of the parties, whether:
- Owned by either spouse before the marriage
- Acquired by either spouse in his or her own right:
- After the marriage
- Before final separation of the parties
- Acquired by their joint efforts.
Ind. Code §31-15-7-4
Effectively, this statute means that no asset is outside of the court’s reach to divide or award to either party. If you own a house prior to your marriage, once you are married, that house becomes marital property. If a house is purchased and only one party’s name is on the house, it is still marital property. Having an item of property titled in only one party’s name does not prevent that property from becoming marital property subject to division by the court. Another important fact to keep in mind is that the length of the marriage does not determine when an asset becomes marital property. If a party owns a business prior to the marriage, the spouse’s interest in the business will also be considered when dividing property. It is equally important to mention that debt incurred by either party is also included in the marital pot and shall be included when determining division of property. Much like the assets listed above, a court can and will determine responsibility for debts, including but not limited to personal debts, student loans, and any other debts.
The only way to ensure that property (assets and/or debts) is excluded from a divorce is by executing a valid pre-nuptial agreement prior to the marriage. Otherwise, only property or debt acquired after the final separation of the parties would be excluded. The date of filing a petition for dissolution of marriage or a petition for legal separation, whichever occurs first, is the date of final separation. Ind. Code § 31-9-2-46. Just because parties lived apart for a period of months, or even years, does not preclude assets or debts acquired during the physical separation from being considered in the dissolution of marriage.
Contact a Family Law Attorney
Although all of the assets and debts are considered marital property subject to division by the court, it does not mean that each party will be ordered to pay half of the debt or that each party will get half of the property. A division of assets must be just and reasonable, and the court has discretion to determine how assets and debts should be divided. Therefore, each case is extremely fact sensitive. This post is intended to provide general information on marital property, and is not a substitution for legal advice.
If you need assistance with a divorce action, contact the experienced attorneys at Banks & Brower LLC for a free consultation at (317) 870-0019 or email us at email@example.com.