Among the most daunting and important divorce topics to address, taking a few moments to learn how gifts, inheritance, and income are handled in a divorce will prepare you for asset division understanding and success.
In the state of New York, equitable division of marital assets and property is the guiding principle. In most situations, any income or property acquired during the marriage is considered marital property and is subject to equal division. Alternatively, any assets acquired before the marriage (or after the divorce filing process has started) are typically considered separate property. Separate property also includes accident settlements.
In the case of gifts and inheritance, these assets are usually categorized as separate property. As long as the gifted or inherited assets remain separate from marital property, the original recipient of that gift would retain the entire sum. But, if that gift or inheritance money was deposited into a shared bank or retirement account, this commingling could then be classified as marital property that is now subject to equitable division.
It’s important to note that these are only standard guidelines, and many other considerations may be factored into the equation when determining fair division of assets. Here are some other key considerations to be aware of as you navigate the asset division process.
Pre & Postnuptial Considerations
If you and your spouse drafted nuptial agreements determining financial division, marital property, and separate property will be defined by these legally-binding contracts. If your contract deviates from the equitable division principles in NY, such as all inheritance will be considered marital property, your prearranged agreement will take precedence over any general state rules.
Court Considerations
If you and your spouse are in disagreement about certain asset-division topics, the courts will weigh a variety of factors when considering a fair division. There’s no cut-and-dry answer because every financial situation is unique, but in general, judges will consider several factors when determining fair division, such as:
- Length of marriage
- Age & health of each spouse
- Child care responsibilities
- Earning potential of each spouse
- Spousal support (alimony)
- Marital misconduct
- Standards of living
As you can see, there are many circumstances that can influence the final asset division outcome. Fortunately, there are steps you can take to retain control throughout the asset division process, even if you and your spouse didn’t create a pre/post-nuptial agreement.
Partner With a Divorce Mediator to Define Your Own Division Outcome
You can side-step the courtroom decision-making process by choosing to organize your division agreement through divorce mediation instead. As long as you and your spouse are willing to discuss, compromise, and agree to each other’s terms, all phases of asset and property division can be managed outside of the courts.
Even though asset and property division laws still apply to your situation, you are not at the mercy of the judge or the outcome of your divorce litigation processes. Instead of hiring lawyers, fighting your spouse, and hoping you receive a fair share of the marital assets, working together to create a mutually beneficial financial split can save time, money, and stress.
With our neutral mediator by your side, you gain factual insights into the legal requirements while simultaneously benefiting from unbiased guidance. We focus on the facts of the situation, doing our best to provide you and your spouse with the information you need and practical suggestions to arrive at a fair and appropriate agreement.
As a team, we work towards a plan that will honor the needs and desires of all parties involved. While it may require courage and strength to approach your division in this communicative and direct way, doing so can transform an otherwise financially and emotionally draining legal situation into a constructive process that benefits both sides in the end.
To learn more about our unbiased divorce mediation processes, contact our helpful experts at Long Island Divorce for a confidential consultation today.