Your divorce is more than just the end of your legal union. When finalized, a divorce also comes with the dissolution of a financial partnership. Specific laws govern the process of asset division and division is not dependent on a single factor.
In Maryland, what happens to property ownership depends on several factors. How you title the property, when you acquire it, and whether it is marital property can affect ownership. It is important to learn the basics of asset division before considering a divorce.
What is “equitable distribution?”
The state follows the equitable distribution rule for property distribution in a divorce. The court aims for a fair outcome, which may not necessarily turn out to be a 50/50 split. While equal splits can be the starting point for negotiations, the court may award you or your spouse more or less depending on various factors.
In Maryland, courts frequently use monetary awards to balance property division. State law gives judges express authority to order the sale of property and division of proceeds. It may also permit direct transfer of ownership for pensions, retirement accounts and other specific assets. Courts will classify property as marital or non-marital, value marital property and may award funds to balance fairness. So, property ownership may stay the same, but you or your spouse may owe money to account for marital value.
Marital vs non-marital property
The first step to property division in Maryland is determining what assets actually belong to the marital estate. Property is usually marital if either of you acquired it during the marriage, regardless of whose name is on it.
Some examples of assets usually treated as marital property:
- Wages earned and bank accounts started during the marriage
- Retirement contributions or family funds saved while in the marriage
- Vehicles or furniture bought while married
- A family home purchased while married
Take note that non-marital property can become “commingled.” For example, when you use non-marital funds (like inheritance) to pay for renovations on family homes. If you cannot trace the non-marital funds, they risk losing their non-marital status.
Protecting yourself during a divorce
Property division is a complex process that requires an accounting of assets and understanding state statutes. If you are facing a divorce, do not act without consulting legal guidance. First, halt financial transactions, gather documents and inventory assets and debts. You may want to consult a legal representative to ensure your rights remain protected during divorce proceedings in Maryland.