The concept of equitable distribution in Florida determines how assets and liabilities are divided between spouses in a divorce. Many spouses going through a divorce have concerns and confusion related to the division of their marital property. This blog aims to give a clear explanation of equitable distribution in Florida divorce law and to provide some practical tips to secure a fair split of assets and debts.
What is Equitable Distribution?
Equitable distribution is the legal term which describes the process used in Florida courts to divide marital property fairly between the spouses in a divorce. Florida law begins with the premise that the distribution of marital assets and debts should be equal, unless there is a justification for an unequal distribution based on relevant factors.
3 Steps to Equitable Distribution
1) Identification of Marital vs. Non-Marital Assets and Debts
- The court must first identify the assets and debts of the parties and place them into “marital” and “non-marital” categories.
- Marital Property – These are assets and debts that were acquired during the marriage, whether they are in both parties’ names or simply in one party’s name. Some common examples include real property, cars, bank accounts, credit card accounts, and retirement accounts.
- Non-Marital Property – These are assets and debts acquired before the marriage or assets obtained during the marriage through a gift or inheritance to one party and kept separate from the other party. Generally, non-marital property is not subject to division in a divorce, although there may be exceptions.
2) Valuation of Marital Assets and Debts
- After the marital assets and debts have been identified, the next step is to determine their value.
- The valuation date may be the date of filing the divorce, the date of separation, or the date of trial. Different assets and debts may be valued as of different dates, which is up to the judge’s discretion as the circumstances require.
- Valuation can include the appraisal of real estate, having a business evaluation, and using balances located on financial statements. Having an accurate valuation is essential to a fair distribution.
3) Distributing the Marital Assets and Debts
- The final step of equitable distribution is actually distributing or awarding the individual assets and debts to each party.
- The starting premise is to equally divide the assets and debts between the parties, however, the court must consider certain factors which may lead to an unequal distribution of the marital assets and debts.
- The factors a court considers in how to distribute the property include the following:
- Length and duration of the marriage
- Economic circumstances of the parties
- Contributions to the marriage by each spouse
- Any interruption to personal careers or education of either party
- Desirability of retaining any asset, including a business or marital home
- Intentional dissipation, waste, depletion, or destruction of marital assets after filing the divorce or within 2 years prior to the filing of the divorce
- Any other factor to do equity and justice between the parties
Tips to Ensure a Fair Division of Assets and Debts
- Gather Complete and Comprehensive Financial Documentation – Compile a list of all assets and debts, whether marital or non-marital. These include retirement accounts, real estate, bank accounts, vehicles, credit cards, loans, and personal property. Accurate information is necessary for equitable distribution.
- Consider Tax Implications – Some assets, such as retirement accounts, may have tax consequences if divided in a divorce. Understanding the tax issues for certain accounts will impact the division of marital property.
- Obtain Professional Valuations – To ensure that each asset is accurately represented, it is often necessary to obtain a professional appraisal of certain assets such as a martial home, a business, or valuable personal property.
- Document Personal Property – It is wise to take photographs or videos of certain personal property items, such as jewelry, collectibles, firearms, electronics, and heirlooms. It can also be helpful to save any receipts, appraisals, or insurance documents related to personal property that may be subject to division in a divorce.
- Plan for the Future – Most cases reach an agreement on asset division through negotiation or at mediation. Keep your long-term financial goals in mind when considering a possible settlement. Make sure any possible settlement agreement factors in your future needs and provides some stability moving forward.
Seeking Legal Advice
Our experienced attorneys can confidently assist you during the equitable distribution process of your divorce. We can help you understand your rights, ensure your interests are protected, and work to obtain a favorable outcome for you. The legal team at Woolsey Morcom will support you through the process and advocate for your interests towards a stable and bright future.
Contact us today to schedule a consultation to discuss your case at 904-638-4235.
