In order to obtain a divorce, either via a negotiated settlement agreement, or through the court process, all marital property must be distributed between the parties.

This necessary task begs the question: What is marital property?

Separate Yet Marital

Under the law, marital property is presumptively anything acquired by one or both spouses during the marriage (from the date of the marriage through the date of divorce), regardless of who holds title to the property. What does this mean? It means that assets accumulated in one spouse’s name during the marriage, are marital property, even if they are not titled jointly with the other spouse.

It also means that simply maintaining separate finances during a marriage does not create separate non-marital property. Similarly, paying for property from individual income earned during the marriage does not create separate non-marital property.

But it is in my name! But I earned it! But I kept it separate! None of those statements alone is enough to create non-marital property under the law.

Exceptions to the Rule

Yet, like most rules, there are exceptions in the law regarding separate property.

Any property acquired prior to the date of marriage, or during the marriage by inheritance or gift, or otherwise subject to a valid agreement such as a prenuptial agreement, and (usually) the growth thereon may be non-marital property.

While a prenuptial agreement provides the opportunity for the parties to agree to different definitions of marital property and separate property, all is not lost if a party does not have a prenuptial agreement. Careful analysis is needed to understand what non-marital claims may exist in which items of property, and what the value of the non-marital claim may be.

Analyzing a Non-Marital Claim

This is an oversimplified explanation of the process, which makes it even more important for any potential non-marital claims to be flagged, analyzed, and staked out early in the separation and divorce process.

How complex the analysis of a non-marital claim may be will depend on the nature of the asset, the availability of documents related to the asset, and whether the asset was comingled or otherwise used to acquire additional assets during the marriage.

Obtaining and maintaining key documents demonstrating the date and method of acquisition, the value, transactions related to the asset throughout the course of the marriage, and any growth are key to the ability to analyze and the stake these claims with credibility in court or settlement negotiations.

Working closely with a lawyer who is familiar with the practices of financial institutions, will help you identify, locate, track, and request the various and necessary documents that would support a non-marital claim – even if it means digging through all of those boxes of old documents tucked away in the basement.

It is important to remember that the burden of proof is on the party asserting the non-marital claim to prove it.

Investing in a proper analysis of non-marital claims may prove to be valuable in terms of removing that property or value from the pot of marital assets to be divided. Analyzing non-marital claims early on in the separation and divorce process will also allow for any potential financial or other experts to be identified and retained early in case forensic analysis, valuation, or testimony becomes necessary.

Mary Likos is a divorce attorney who represents clients in child custody, child support, alimony, and complex financial matters. For more information, contact Mary at mrlikos@lerchearly.com.