What Happens to Your Property and Assets in a Pennsylvania Divorce?
One of the most challenging aspects of divorce is dividing property and assets with a soon-to-be-ex-spouse. Property division between the spouses can be a contentious and complex matter, particularly in a high-asset divorce or when a business is involved. In a divorce or annulment, marital property is divided between spouses without regard to any marital misconduct.
Pennsylvania is not a community property or common law state. Marital assets and debts are subject to distribution between the spouses pursuant to Pennsylvania Consolidated Statutes, §3502. Equitable division of marital property. This is not necessarily a 50/50 split. When the matter is decided by the court, property is divided between the spouses equitably after consideration of all relevant factors.
What Is Considered Marital Property?
“Marital property” is defined in the Pennsylvania Consolidated Statutes at Title 23, Chapter 35, Property Rights. This term means all property acquired during the marriage by either party. It also includes the increase in value during the marriage of any nonmarital property acquired before the marriage or acquired by gift, except between the spouses or by inheritance.
For example, a home that was purchased by either spouse during the marriage is considered marital property, even if only one spouse holds title to the property. A home purchased by either spouse before the marriage is separate property; however, if the home appreciates in value by $100,000 during the marriage, the amount of appreciated value ($100,000) is considered marital property and subject to equitable division.
Marital property does not include:
- Property excluded by a valid prenuptial or postnuptial agreement between the spouses
- Property acquired by either spouse before the marriage or in exchange for property acquired before the marriage
- Property acquired by gift (except between the spouses), or by devise, bequest, or descent, or property acquired in exchange for any such property
- Property acquired by either spouse between the date of final separation and the date of divorce, except when acquired in exchange for marital property
- Any settlement or award from a lawsuit or claim that accrued before the marriage or after the date of final separation, regardless of the date of payment
How Is It Decided Who Gets What Marital Property in a Divorce?
Division of marital property can be determined in either one of two ways in a Pennsylvania divorce:
The parties may reach a marital settlement agreement detailing, among other things, how marital assets and debts will be divided between the spouses. This is a binding contract between the spouses that addresses the issues of a divorce, including child custody, alimony, and property division. A marital settlement agreement may be reached through a collaborative divorce, in which both parties sit down with their attorneys, along with other specialists in some cases, to negotiate the terms of their agreement. A settlement agreement may also be reached through mediation, in which a neutral third-party mediator facilitates negotiations between the spouses.
If divorcing spouses are unable to reach an agreement about the division of marital property on their own, the case will be decided at trial, by a family court judge. Pursuant to state law, the court must equitably divide marital property in a manner it deems just after considering all relevant factors. An experienced Pennsylvania divorce attorney can serve as a dedicated legal advocate and litigate on your behalf to ensure your rights to marital property are protected.
What Factors Do the Courts Consider in Equitable Division of Marital Property
When it is left up to the court to determine how marital property will be divided equitably between the spouses, judges consider many factors, including:
- Length of the marriage
- Any previous marriage of either party
- Standard of living established during the marriage
- Age and health of each of the parties
- Economic circumstances of each party at the time marital property is to be divided
- Income, liabilities, vocational skills, employability, and needs of each of the parties
- Sources of income, including medical, insurance, retirement, and other benefits
- Opportunities of each party for future acquisition of income and capital assets
- Contributions by either party to the training, education, or increased earning power of the other
- Each party’s contribution or dissipation in the acquisition, preservation, appreciation, or depreciation of marital property, including contributions as a homemaker
- Value of each party’s sole and separate property
- Tax consequences associated with division, distribution, or assignment of each asset
- Expense of sale, liquidation, or transfer of assets
- Which party will serve as the primary custodian of any minor children
How Are Marital Debts Divided Between the Spouses?
Debts incurred by either or both spouses after the date of the marriage and before the date of separation are included in the marital property. These debts may consist of one or more mortgages, credit card accounts, tax obligations, and personal or business loans. No matter who incurred the debt, if it occurred during the marriage, it is considered marital property and divided between the parties. As with marital assets, the court will consider all relevant factors before deciding on the division of debts.
How Can an Experienced Pennsylvania Divorce Attorney Protect Your Rights
Our experienced Pennsylvania attorneys at Peak Legal Group can represent you in every aspect of the divorce process, including the division of marital assets and debts. We can help you negotiate a fair resolution of the issue with the other spouse or fight for your rights in court if necessary. Contact us at (610) 989-7064 if you are facing divorce and marital property division.