Property and Debt Division

In every divorce or dissolution the court must divide the property owned by the parties. Generally, some property will be distributed to the husband and some property will be distributed to the wife.

Property

The term “property” refers to financial assets and legal rights that have some economic value. Typical examples of such assets include homes, cars, furniture, bank accounts, stocks, bonds, and mutual funds. Other examples include pensions, retirement plans, individual retirement accounts (IRAs), some life insurance policies, and complex assets.

Complex Assets

Complex assets are assets that are legally or financially complex such as interests in businesses and professional practices. Other examples include sophisticated financial investments (stock options, limited partnerships, etc.), interests in estates and trusts, contract rights, intellectual property rights, tax and government benefits, and rights and interests in real estate located in other states and countries. Complex assets are discussed in greater detail on our Complex Asset page.

Marital Property

Marital property is property acquired after the parties’ marriage which is still owned at the time the marriage is terminated. Generally, marital property is acquired through the efforts of one or both parties. Property may be marital property even if the property is titled in the name of only one party. Generally, when a marriage is terminated, the value of the marital property is divided equally between the parties.

Separate Property

Separate property is property that is not marital property. Five primary types of separate property exist: property owned prior to the marriage; property received as a gift; property received as an inheritance; property received as a personal injury award; and property addressed in a valid prenuptial agreement. When a marriage is terminated, separate property is awarded to the owner and is not divided between the parties.

Commingled Property

Commingled property is property that is part marital property and part separate property. Generally, commingled property is treated like marital property as it is divided equally between the parties. However, in some cases, the separate property component will be distributed solely to one party. For this to happen, the party seeking the property must “trace” the current separate property component back to the original item of separate property. The party must show some strong relationship between the current separate property component and the original item of separate property.

Valuation

Generally, for every item of property a dollar value must be determined. Some items are easy to value. For example, to value a bank account, the balance in the account can be determined online or from the last bank statement. Other items are more difficult to value. For example, conflicts often arise regarding the value of real estate and interests in businesses and professional practices.

Division of Property

When a marriage is terminated, a final court order will state what property is awarded to the husband and what property is awarded to the wife. A court order dividing property is final and cannot be modified in the future.

Debt Division

A debt is a legal duty to pay money. Typical examples of debts include home loans (mortgages), car loans, home equity line of credit loans, and credit card debts. A debt can be classified as a marital debt or as a separate debt. Like property, the parties’ debts are divided when their marriage ends.

Financial Misconduct

If a court finds that a party has engaged in financial misconduct, the court may adjust the property and debt division to achieve a fair result. Various types of financial misconduct exist. For example, a party who wrongfully causes property to disappear or decrease in value has committed financial misconduct.

Contact Us

Please contact the attorneys at Dougherty, Hanneman and Snedaker for a confidential consultation with an Ohio State Bar Association Certified Specialist in Family Relations Law regarding your family law issue. Attorneys Douglas Dougherty, James Hanneman and Robert “Chip” Snedaker are three of just ninety-nine attorneys (as of January 1, 2008) in the state of Ohio, who have earned the designation of Certified Specialist, Family Relations Law.