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What Constitutes Property?
By Carol Ann Wilson
Property includes such assets as the family home, rental property, cars, and
art or antique collections. It can also include bank accounts, mutual funds,
stocks and bonds, cash value life insurance, IRAs, and retirement plans. And
yes, career assets and PHTs or PWTs (putting husband/wife through school). As
you can see, there is virtually no limit to what can be considered property.
Laws vary from state to state on how to
divide it. Property issues account for a large number of appeals! Although there
are exceptions to just about everything, when it comes to property, it is
usually divided into two categories: separate
and marital.
In general, separate property, property
that will not be divided, includes what a person brings into the marriage,
inherits during the marriage, or receives as a gift during the marriage.
On the other hand, marital property, which
can be divided, is everything acquired during the marriage no matter whose
name it’s in. In some states, marital property also includes the increase in
value of separate property.
Do you know what kind of state you live in
and what rules of property division your state follows? There are three
different types of states: community
property, equitable
distribution, and equal
distribution. The differences are
subtle. Once you know how your state handles property division, you can decide
which property is yours or your spouse’s and which is owned jointly. The great
majority of states have detailed statutes that categorize property.
In community property states (Arizona,
California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and
Wisconsin), property that is not subject to division of the court - your and
your spouse’s separate property - is the first to be identified. The court
then may decide on how marital, or community property is divided. Again,
separate property is owned before the marriage, or obtained by gift or
inheritance during it. Everything else is community property and is subject to
equal division. Some community property states require that all property
acquired during the marriage be split equally, while others divvy up assets in
the same way as equitable distribution states do.
The equitable distribution states usually
agree that your marital property be divided equitably, or fairly, between you
and your spouse. In equal distribution states, the property is divided - you
guessed it - equally.
Source: The Dollars and Sense of Divorce, ©
1998, by Carol Ann Wilson, Judith Briles, & Edwin Schilling
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