How Will My Property Be Divided in a Divorce?
In every Wisconsin action for divorce, legal separation or annulment, the court must divide the property of the spouses. Property includes assets such as real estate, retirement accounts, businesses and vehicles, as well as debts such as mortgages, vehicles loans and credit cards. During the divorce proceedings, both parties will be required to provide full disclosure of all their income, assets and debts to the court and to their spouse. Property should be valued as close to the date of the final divorce hearing as possible, which may require appraisals or other methods of valuation. All property owned by the spouses will fall into one of two categories: (1) property not subject to division and (2) property subject to division.
Under Wisconsin law, there are three ways a person obtains property not subject to division: (1) by gift from a third party other than their spouse; (2) by death of another, such as an inheritance; and (3) property obtained with funds received through gift or inheritance. Property not subject to division is almost always awarded to the spouse who acquired it by gift or inheritance. An exception would be if the court decided that not dividing the property would create a hardship to a spouse or child. Another exception could occur when property received by gift or inheritance is commingled or mixed with joint property. A common example of this occurs when a spouse receives an inheritance, deposits the funds into a joint bank account, and then spends the funds on the marital residence, items of personal property, or the couple’s living expenses. The inheritance then is most likely no longer nondivisible property.
Property that is subject to division (“marital property”) is essentially all other property of the couple not acquired by the three methods listed above; this also includes assets owned by a person before marriage. Usually, this is the majority of a couple’s assets and debts. Property can be marital property regardless of how it is titled. For example, a house titled in only one spouse’s name is usually considered marital property, unless that spouse obtained the house by gift or inheritance. All property subject to division is included in the “marital estate.”
Wisconsin is a marital or community property state; this means that in a divorce, the marital estate should be divided equally between the parties. This does not mean that every asset needs to be split in half, but rather that after all items are assigned to one spouse or the other, each spouse should be left with approximately one-half of the total net value of the marital estate. In many cases, this may require one spouse to pay an equalizing payment to the other spouse, in order to even out the property division.
The court does have the ability to order an unequal property division. When deciding whether to do so, the court considers various factors including the length of the marriage; property brought to the marriage by the spouses; age, health, earning capacity, and education of each party; and any written prenuptial or other agreements the parties entered into to divide their property.
After the property division is completed and the divorce is final, parties may need to take additional steps to transfer property to the appropriate spouse. This may include executing a quit claim deed to transfer real property, refinancing a mortgage to remove a spouse’s name, or preparing a court order to divide a retirement account.
For further information on this topic or other family law issues, please email Attorney Abby Theisen ( firstname.lastname@example.org ). All of our attorneys may be reached by phone at 920-731-6631 to discuss the legal services you require.
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