How Does Property Division Work During A Florida Divorce?
Concerns over property division are one of the questions that divorce attorneys are most frequently asked. Florida is an equitable distribution state, which means that the court divides assets in a way that is equitable to both parties. This does not necessarily mean the split will be 50/50. The split is supposed to allow both parties to move forward in a manner that allows them to maintain their standard of living. While in most cases, this will mean a 50/50 split, there are situations where it will not. In this article, we’ll discuss how equitable distribution works in your Florida divorce.
The first concept you need to be aware of is what is defined as marital property. Marital property begins when a couple is married and continues to accrue value until your divorce petition is filed. Any and all real property, personal property assets, or retirement accounts acquired during the marriage are considered marital property. This includes accrued property value in the form of assets.
How does accrued property value work?
Let’s say one spouse operates a business. They began this business before the marriage began. Prior to the marriage, the business was valued at $250,000. During the marriage, the business accrued $750,000. The business is now worth a cool million. How does that work when it comes to equitable distribution?
The $750,000 in accrued value is considered marital property, while the original $250,000 would still belong to the spouse who started the business and is considered that spouse’s pre-marital property.
The same holds true for other types of property as well, including valuable collectibles and retirement accounts. In calculating the marital portion, there would be a set-off for the amount of pre-marital property.
I don’t want to divide my business
Fair enough, but this is where the tradeoffs come into play. In order to retain the entire value of the business, the spouse with the pre-marital business would need to either buy out the other spouse through an equitable distribution payment or would need to exchange another marital asset of approximately the same value. These are all part of the negotiation process when settling a divorce. Through mediation, both parties have the opportunity to negotiate and do things a Judge can not do under the law if the case were to go to trial.
How do you determine the value of a business?
Most people don’t really the value of their business. That’s okay. Divorce lawyers work alongside property appraisers and business valuation experts who will evaluate the business to determine what it was worth before and after the marriage.
Your attorney will guide you along during the process, listen to your individual needs, and propose a strategy that meets your needs. Ultimately, such problems are very common in Florida, and experienced family law attorneys deal with these matters every day.
One way to avoid this type of situation is to use a prenuptial agreement. A prenuptial agreement can protect certain property from equitable distribution under Florida law. These agreements are almost always enforceable unless they were entered into under fraud or coercion. Most couples don’t think about that until it’s too late.
Talk to a Lakeland, FL Divorce Lawyer Today
Darla K. Snead, P.L., Attorney at Law in Lakeland, Florida, helps clients manage all types of property distribution in divorce. Call a Lakeland family lawyer at our office today to schedule an appointment and we can begin discussing your concerns immediately.