Division of Property
By: Tim Davids, Authority Content writer
Splitting property can be tricky but due to good communication, written agreements and the involvement of some neutral third parties can work well. Property is where prenuptial agreement does its job. If jewelry and goods, items and household appliances need to be sold, a third party can agree to vend the items secondhand or auction them and report the proceeds. negotiation for family heirlooms that currently are joint property and the “return” of greatly prized items should be done as rationally as possible.Debts incurred between legal separation and divorce should be handled accordingly. Splitting property in the event of divorce is easier if a pre-nuptial agreement is in place.
Splitting property in some states has a legal encumbrance to it. Hidden assets are usually “discovered” during this period through forensic accounting. Money invested in collectible baseball cards from online gambling proceeds, or undeclared gifts from friends or admirers often don’t make the list. But if a married person in a community property state accepts items of value, this value must be shared in the property division agreement. Nobody really wants the “Solomonic” method where half a motorcycle or half an antique vase gets awarded to each party. When values are established, horse trading can begin.
It’s important to clarify who gets what. A wife may assume her husband’s end of the year bonus even after the divorce is half hers. The husband may not care to share his stock options so they might be valued and the derived value assigned to part of the money the husband pays the wife upon divorce. If the marriage has been operating on assumptions of shared future earnings from a professional career not yet begun or showing profit, arrangements for future earnings might be made. Pending tax refunds, credit rewards such as points of frequent flyer miles, timeshare vacation privileges, season tickets rights, and any business dealings where the joint parties operated as a single entity must be anticipated and divided.
Many items can be overlooked when splitting property. If the wife took all her sick days from work to watch the kids when they were sick, but the husband has all his sick pay and can be remunerated for it, this is cash property which has a value that must be divided. If the wife invested in a hobby business venture which profited, the dividends and physical inventory should be assessed and a value awarded for division.Splitting property can be tricky when neither party has the cash or ‘credit” to obtain, buy, or trade for the other half of some object or item they want. Splitting property in a divorce should be accompanied by certificates of ownership and copies of the division of property notarized and stored safely.