The primary means of achieving economic justice upon divorce is through the distribution of marital property. Whether the resolution of the economic issues surrounding divorce is obtained through the courts, or by agreement, a just result must consider how marital property will be divided, how that property will be valued, and what property is, and is not, marital.
Strictly speaking, “marital property” does not exist prior to the filing of a divorce complaint. Marital property is a legal term used to describe that property that must be divided between spouses as part of the divorce proceedings. Marital property is not dependent on legal title, and it should not be confused with “community property,” a concept that currently exists in nine states, but not Pennsylvania, and which presumes that each spouse has a one-half interest in property acquired during the marriage.
In contrast, in Pennsylvania, marital property is “equitably distributed” upon divorce, and there is no 50/50 presumption. Equitable distribution is a three-step process, requiring the identification of the components of the marital estate, the valuation of these assets, and finally, the application of the multiple factors set forth in the Divorce Code to determine the actual distribution between the parties. These “factors” may result in an uneven distribution, or, in appropriate cases, an award of the bulk, or all, of the marital estate to one party.
All property acquired during the marriage, or any property acquired after separation, but in exchange for property acquired during the marriage, is presumed to be marital. This property is typically valued as of the date of distribution, unless reasons exist for valuing it at the date of separation (for example, when one party causes the decrease in value of an asset after separation). Retirement benefits are property subject to equitable distribution when acquired during the marriage, as are increases in the value of property owned by one spouse or the other before the marriage. Marital debts are also included in the marital estate, and must be distributed just as assets are distributed.
Items that are excluded from the martial estate include property: acquired prior to marriage, excluded by agreement, or acquired by one party only by gift or inheritance. Other issues as to what is in the marital estate, and often more importantly, how and when it will be valued, are extremely important to the fair and equitable resolution of a divorce. These issues can become complex, especially where the marital estate includes closely held or family businesses.
Our firm has decades of experience valuing complex marital estates and working with expert accountants to accomplish this task. Whether you are the dependent spouse and are concerned with concealment of marital assets, or you are a business-owning spouse concerned with a fair valuation and distribution, we have the expertise to evaluate, litigate, and resolve complex property distribution issues.
To learn more about what Wilder Mahood McKinley & Oglesby can do to resolve your distribution of property, contact us online or call our office in Pittsburgh, Pennsylvania, at 412-261-4040.