What's Mine Is...Not Necessarily Mine

undefinedBy Robert M. Sakovich, Esq.

In Pennsylvania, marital property can be divided equitably between the parties to a divorce. This means that the court seeks a fair division of marital property based on the unique circumstances of the marriage. It also means the court does not base its decision on property that either party may own as non-marital property.

The line between marital and non-martial property is intentionally vague. This allows for some gray areas – and thus some flexibility in a proceeding where fairness is the goal – in determining whether a particular asset or liability should be counted in the equitable distribution calculation. But this means that every divorce begins with a surprisingly complex question being asked repeatedly: “Is this marital property?”

For example: An IRA owned before your marriage may be non-marital in part, but growth in the value of the IRA during marriage is likely marital, as are contributions to it during the marriage. Post-separation growth on the non-marital portion of that same IRA may not be marital. If you are the owner of such an IRA and intend to keep it in your divorce, you benefit from showing that as much of that account as possible is non-marital, since only marital assets are factored in to the decision about what is an equitable division of assets. On the other hand, if your spouse will be keeping the asset, you want as much of it to be marital as possible: the more marital assets your spouse receives, the more your spouse will have to compensate you for (or the less you will have to compensate your spouse for).

But making this argument is not always a worthwhile endeavor. Some assets are easy to show: If your IRA had only one contribution prior to marriage and only growth for the duration of the marriage, a comparison of the value on the date of marriage and the date of separation will reveal the marital value. In such a case, we may have agreement from an opposing party regarding a non-marital asset. But where we don’t have agreement, proving the marital value of partially pre-marital property requires appraisal by a paid professional. Of course, your spouse will have the opportunity to offer a conflicting opinion from his or her own expert.

The costs of these experts and the costs of the legal arguments are unavoidable. The question, ultimately, is whether the difference is worth an appraisal and whether arguing over the difference is a cost-effective proposition for you, which depends on the value of the asset and the disparity between your estimate and your spouse’s estimate. An experienced attorney with a background in high-asset divorces can be beneficial to making this determination.

If you are contemplating getting a divorce call Scaringi Law 717 775 7195 and have them outline your options.



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