How Assets are Divided in a Virginia Divorce
Asset distribution can be one of the most contentious aspects of a Virginia divorce. If you can’t come to an agreement on your own on what is a fair distribution, the court is the one who will be left to determine who gets what. Despite what you might be imagining, assets and liabilities are divided according to local law.
In Virginia, it’s done based on the system of equitable distribution. There are now over 40 states that use equitable distribution as the law for dividing property and debts during a divorce. This is not a 50/50 split like in the remaining community property states. Equitable distribution means assets are distributed in an equal or fair manner.
Classifying Property in a Divorce
To determine how property is split, it must be classified first. Marital property is defined as assets that are jointly owned, along with any other property that was acquired from the date of marriage to when you separate, except separate property. Separate property is any property that was acquired prior to the marriage or all assets acquired during the marriage that was a gift from someone other than the spouse or is an inheritance. An example of separate property would be a cash gift from a relative that is kept in a separate bank account. Jewelry given from one spouse to the other would be considered marital property.
When Separate Property Becomes Marital Property
It’s important to note that some assets you assume are separate could wind up being declared marital assets in select scenarios. This can lead to even more adversity during the divorce. Property that may be partially separate and partially marital can be more complex to divide.
An example of property in this category would be one spouse inheriting a business before the marriage. During the course of the marriage, one or both spouses work for the company and produce income. This income can be declared marital property, even though the asset would normally be declared separate property. Another example would be separate property that gained value during the marriage. A portion of it could be declared marital property due to the personal efforts of either spouse if they contributed to the increase.
The law defines personal effort as labor, inventiveness, intellectual or physical skill, promotional, creativity, or marketing activity that was directly applied to the separate property in question.
Personal Injury Settlements as Marital Property
In some cases, a settlement for a personal injury lawsuit can be deemed marital property. If the cause of the lawsuit occurred prior to the marriage or after the final divorce decree, then it will be separate property. However, if the accident occurred during the course of the marriage, it is presumed marital. You can rebut that assumption, but you would have to show what portion is separate. A pain and suffering award is considered separate property. Reimbursement for economic losses, like your medical bills and wages, could be deemed marital property.
Retaining a Virginia Divorce Attorney
Asset distribution in a divorce can be complex, even if you don’t have a lot of money or property. This is why it’s important to retain an experienced Virginia divorce attorney. Contact Whitbeck Cisneros McElroy PC at 703-997-4982 to schedule a consultation.