Long Island Divorce Attorney Describes All You Need to Know About Equitable Distribution
As an experienced Long Island Divorce Attorney practicing in Suffolk County and Nassau County, I have seen many couples confused over the method of dividing marital property in the State of New York. Many people enter my office under the assumption that marital property will be distributed on an even (50/50) basis, but that is not the case. Unknown to most Long Islanders is the fact that New York is an Equitable Distribution jurisdiction, which means that marital property will be divided “equitably” among you and your spouse. This is where the confusion sets in, because Equitable Distribution does not automatically entitle you to an “equal” distribution of property. Rather, each distribution is made on an individual, case-by-case basis to ensure distribution is fair and just.
What Is Marital Property in Nassau & Suffolk County Court in a Long Island Divorce?
Marital property includes all property acquired and/or earned by either you or your spouse during the marriage. Naturally, separate property is that which was acquired before the marriage, and also includes gifts, inheritance, or legal settlements (such as personal injury) received by one spouse regardless of whether or not they were acquired during the marriage. Anything acquired in exchange for your separate property is also separate property, even if acquired during the marriage. As always, you and your spouse were/are free to make any agreement you wish regarding separate and marital property. This is where the existence of a pre-nuptial or post-nuptial agreement would be of importance: if you are a party to either one of these, it will supersede the application of Equitable Distribution and govern the distribution of your marital property.
The Definition of Marital Property Seems too Simple, What are the Nuances?
If this question ran through your mind, you were right to think of it. There are a few important points which you should be aware if you believe a Nassau County or Suffolk County Court will be required to apply Equitable Distribution to your marital property.
First, earning a professional degree during the marriage, whether it is a bachelor’s degree, or medical license, or other professional degree, has an impact on Equitable Distribution on Long Island, New York. If you or your spouse obtained a professional degree or license during the marriage, the other is entitled to receive a percentage of the licensed or degreed spouse’s “Enhanced Earning Capacity.” The Enhanced Earning Capacity is the difference between the spouse’s earning potential at the time of the marriage based upon his or her level of education and the spouse’s earning potential based upon the education or license obtained during the marriage. This number is then multiplied by the number of years the degreed or licensed spouse could potentially receive the benefits of the degree or license, and a portion of that is attributed as marital property subject to equitable distribution.
Second, if you purchased the home that served as the marital residence prior to the marriage you may assume you are entitled to retain the residence or be credited for any amounts of separate property you invested. However, as the purchasing spouse, it is your burden to prove you made a contribution of separate property to the purchase. It is important to obtain bank records or any other sort of proof from a financial institution showing a portion of the down payment on the marital residence was paid for with separate property. You will only be entitled to a separate property credit if you can prove the sums you contributed individually. If you cannot satisfy this burden, the entire value of the marital residence could be subject to Equitable Distribution.
Is Marital Debt Subject to Equitable Distribution As Well?
As this chapter briefly explained, marital assets are the property and earnings obtained during the marriage. What is a lesser-known fact is that marital debt and liabilities incurred during the marriage and up until the date of commencement of the Action for Divorce, are also subject to Equitable Distribution. That means that the $5,000 shopping spree your spouse went on days before he or she filed for divorce may still be your responsibility. You are naturally wondering “How is that fair?” and you are right. It may not be “fair” per se, but Equitable Distribution looks at a marriage as a union, and therefore there is joint responsibility for all benefits and burdens, including debt and liabilities.
In order to avoid Equitable Distribution being used to distribute marital debt, you and your spouse can enter a Stipulation of Settlement with the help of your Nassau County or Suffolk County Divorce Attorney. These agreements generally contain an entire article devoted to marital debt and setting forth who is responsible for paying what and for which debts you will assume joint responsibility. All identifying information should be placed in the agreement, including the creditor, the amount owned, when the payments are to be made, and who will be making the payments. If you and your spouse do not have joint debt, a statement representing that fact will be placed in the agreement.
What Factors Are Considered in Equitable Distribution in Your Long Island Divorce?
Nassau County and Suffolk County Courts do not blindly employ Equitable Distribution on Long Island. Rather, certain factors set forth by the New York Domestic Relations Law are taken into consideration.
One factor considered is the income of you and your spouse both during the marriage and at the time the Action for Divorce is commenced. Therefore, it is important to keep a close account of your finances and to inform your Nassau County or Suffolk County Divorce Attorney of any changes in income from the time of the marriage to the commencement of the proceeding (including earning a professional degree or license).
Additionally, the health and age of both you and your spouse are important. This plays a role in the future earning capacity of you and your spouse and may require one receive a larger “equitable share” of the marital assets than the other. If you are facing the possibility of losing health insurance due to the divorce, it is important to inform your divorce attorney of this fact – especially, if you are suffering from an illness.
The purpose of Equitable Distribution is to ensure that the distribution of the marital assets is fair and just, therefore, if you are ill and set to lose insurance, you may be awarded a greater share of the marital assets than your healthy spouse.
You may also face the loss of pension benefits after your divorce. If your spouse is the holder of a pension plan, a divorce serves as an automatic revocation of your rights under this plan (so long as this is not inconsistent with standing federal law, so be sure to check with your Long Island Divorce Attorney regarding this issue).
Further, any extreme disregard for finances during the marriage (such as excessive gambling, spending, etc.) will also be taken into consideration in making the Equitable Distribution determination.
It is important to note that fault or misconduct on behalf of you or your partner is generally not taken into consideration when determining an Equitable Distribution of the assets. Therefore, if either of you feel the other is “at fault” for the dissolution of your marriage, it is helpful to be aware that unless the underlying cause of the divorce is extreme, it will not be taken into consideration when determining what is fair and equitable.
Do You Need Help Determining What is Fair & Equitable in the Division of Your Marital Property in Your Long Island Divorce?
The experienced and compassionate divorce attorney Long Island’s Robert E. Hornberger, Esq. and his team have helped hundreds of people in Nassau County and Suffolk County ensure they receive a fair and equitable distribution of their marital property. Don’t let your spouse take more than his or her fair share. Give us a call at 631-923-1910 or fill out the short form on this page to schedule a free divorce consultation.