As part of a divorce proceedings, divorcing couples have to split their assets and liabilities. In Florida, the distribution of assets and liabilities is governed by “equitable distribution”, which meant that the court must begin with the premise that the distribution of marital assets and liabilities should be equal, unless there is a justification for an unequal distribution.
If you are going through a divorce and you and your spouse cannot reach an agreement regarding the distribution of your marital assets and liabilities acquired during the length of the marriage, a court will make that decision for you.
In order for the court to properly divide assets and liabilities between the parties, it first must classify the parties’ assets and liabilities into “marital” and “non-marital” assets and liabilities. Non-marital assets and liabilities are not part of the equitable distribution scheme. Florida Statute states that “the court shall set apart to each spouse that spouse’s non-marital assets and liabilities.”
Marital Assets and Liabilities are classified under Florida Statutes §61.075(6)(a) and include:
- Assets acquired and liabilities incurred during the marriage, individually by either spouse or jointly by them.
- The enhancement in value and appreciation of non-marital assets resulting from the efforts of either party during the marriage or from the contribution to or expenditure thereon of marital funds or other forms of marital assets, or both.
- The pay-down of principal of a note and mortgage secured by non-marital real property and a portion of any passive appreciation in the property, if the note and mortgage secured by the property are paid down from marital funds during the marriage. The portion of passive appreciation in the property characterized as marital and subject to equitable distribution is determined by multiplying a coverture fraction by the passive appreciation in the property during the marriage.
- Inter-spousal gifts during the marriage.
- All vested and non-vested benefits, rights, and funds accrued during the marriage in retirement, pension, profit-sharing, annuity, deferred compensation, and insurance plans and programs.
Non-Marital Assets and Liabilities are also known as “separate property.” These are any assets and liabilities brought into the marriage, by either spouse. Under Florida Statutes §61.075(6)(b) “non-marital assets and liabilities” include:
- Assets acquired and liabilities incurred by either party prior to the marriage, and assets acquired and liabilities incurred in exchange for such assets and liabilities;
- Assets acquired separately by either party by non-inter-spousal gift, bequest, devise, or descent, and assets acquired in exchange for such assets;
- All income derived from non-marital assets during the marriage unless the income was treated, used, or relied upon by the parties as a marital asset;
- Assets and liabilities excluded from marital assets and liabilities by valid written agreement of the parties, and assets acquired and liabilities incurred in exchange for such assets and liabilities; and
- Any liability incurred by forgery or unauthorized signature of one spouse signing the name of the other spouse. Any such liability shall be a non-marital liability only of the party having committed the forgery or having affixed the unauthorized signature. In determining an award of attorney’s fees and costs pursuant to s. 61.16, the court may consider forgery or an unauthorized signature by a party and may make a separate award for attorney’s fees and costs occasioned by the forgery or unauthorized signature. This subparagraph does not apply to any forged or unauthorized signature that was subsequently ratified by the other spouse.
Even though the definition of marital or non-marital assets and liabilities seem pretty clear, there are a number of exceptions to the process. This can make the process of dividing these assets and liabilities a bit confusing, especially when the couple’s assets and liabilities have somehow “mixed together”, which is known as “commingling of property.” A classic example of commingling property is when money from an individual account is deposited into a joint account. The money of these two accounts “mixes” and becomes commingled property.
If you going through a divorce and have questions about how to determine the distribution of your property, Seff & Capizzi Law Group has the ability to assist with your situation. At Seff & Capizzi Law Group, we regularly assist clients and provide valuable information for those that need assistance in understanding how to approach this particular situation in their own lives. Call us at (954) 920-9220. We have over 40 years of experience and offer a free consultation. Click here for more information about our family law practice and how Seff & Capizzi can help.