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Division of Assets and Liabilities in a Divorce
A common question by many people considering a divorce is “how do we divide our stuff”? The first thing to know is that a couple does not just divide their assets (or the things with value), but also, their liabilities (what they owe). The goal is to divide both marital assets and marital liabilities equally so that both parties receive the same total value. In Florida, we call this “equitable distribution.“
The equitable distribution statute is Florida Statute 61.075 and governs the process by:
- Defining what are marital assets and liabilities and what are not;
- Establishing a presumption of equal division of all marital assets and liabilities while outlining the justifying criteria for an unequal distribution;
- Providing the framework for accomplishing an equitable distribution.
Division Of Assets Is More Than A 50/50 Split
In sum, equitable distribution is much more involved than simply dividing a martial estate in half. If you have any questions regarding dividing marital assets and liabilities in your divorce, please contact our dedicated Family Law attorney, Adam Bragg to set up an appointment he would be happy to discuss your case with you.
Equitable Distribution Broken Down
What does this mean? Because the entire marital estate needs to be divided, the first task is to determine what assets and liabilities are marital and therefore need to be included in equitable distribution. Whether something is marital or non-marital can be highly contested issue because non-marital is not considered when dividing the estate. This can greatly affect what the parties are left with after the divorce.
Once the marital property is identified, then it needs to be divided as equally as possible. It is easiest to look at it as if all the various properties (assets and liabilities) are placed in one large pot. The whole pot is then to be divided as equally and fairly as possible. This does not mean everything that can be divided equally will be. This is a common misconception. Frequently, parties start focusing on individual assets and wanting to divide them; instead of looking at the bigger picture. The total value distributed should be equal.
Finally, considering value is another important issue is equitable distribution. Not all assets or liabilities are truly equal – something may be equivalent cost wise but have other benefits to a particular party – or even easy to value. It is quite common to argue about what something’s actual value is. What is the business worth? When do we value the investment? Do we use the appraised value of the home or something else? What are the tax consequences of this distribution plan on the parties?
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With over 20 years of combined experience in family law, we know how to navigate the system to fight for what’s right. Let us fight for you.