How can our assets be divided fairly during divorce?

How can our assets be div…
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Maryland is an equitable—not equal—division state when it comes to dividing marital property between spouses. However absent extraordinary facts, there is generally an equal division of marital property at the time of divorce. That concept alone is not what causes battles regarding the division of assets between divorcing couples.

In most cases, and in terms of fundamental fairness, clients tend to struggle with this concept when premarital assets have been commingled with marital assets and the spouse seeking the return of an asset is unsuccessful because the court doesn’t believe it can adequately trace the money back to the premarital sources. This often happens when premarital retirement or brokerage accounts have been combined with marital accounts during the marriage.

If one of the spouses had spoken with me about how not to commingle the asset in question, the advice I would likely have given would have been to keep premarital accounts separate from the marital ones during the marriage. However, if it was not possible to keep premarital accounts separate during the marriage then the spouse wanting to preserve the premarital claim, should have kept meticulous records of the accounts from the month before the start of the marriage and throughout the entirety of the marriage.

Note, commingling can also occur with the acquisition of real property during the marriage. It is a bit more difficult when it comes to the acquisition of real property because you cannot easily keep premarital and marital money separate when purchasing a home. If that is your situation, then you should have kept meticulous records of where money came from that was used to contribute to the purchase of the real property.

Another issue that can arise in this circumstance is if one spouse has more marital property titled in his or her name than the other spouse. In this situation, the court can grant the spouse with less marital property a monetary award.

For example, let's say that the only item of marital property is a snowmobile which is titled in the wife’s name and it has been valued at $100,000. Since the court cannot transfer the snowmobile from the wife to the husband to balance the inequity, the court could grant the husband a monetary award that the court believed was fundamentally fair to resolve the imbalance. The monetary award isn’t absolute. It could be $50,000. It could be $30,000. It could even be $60,000. The award doesn't have to be equal to half of the value of the asset as long as the court believes it's fair.

In considering what is fair, there are eleven (11) statutory factors that the court considers when making a monetary award. These factors include:

  • The length of the marriage
  • The monetary and non-monetary contributions of each spouse to the marriage
  • The reason for the breakup of the marriage
  • The value of all property owned by each party including non-marital property
  • How marital property was acquired
  • Any other factor that the court believes is fair to consider