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Wheaton asset division attorneyWhen you and your spouse got married, you might have moved into a house that one of you owned already, or you might have found a new home together. Since your wedding, it is also possible that you and your spouse have upgraded and bought a house big enough to accommodate your growing family. If you find yourself facing the prospect of a divorce, however, how and when you and your spouse bought your current home could affect its status as a marital asset.

Equitable Distribution in Illinois

According to Illinois law, a divorcing couple’s marital property is to be divided equitably, or fairly, between the spouses. The law also defines marital property as assets or debts acquired by either party during the marriage, with limited exceptions for inheritances or gifts to one spouse. Property that was acquired before the marriage is considered to be non-marital and is not subject to being divided during the divorce. This includes the home where you and your spouse were living when the marriage ended.

How and When the Home Was Purchased

If the home in question was purchased and fully paid off by either you or your spouse before you got married, it is not likely to be considered a marital asset by the court. It would more likely be considered a non-marital asset and awarded to the spouse who bought it originally. However, if you bought the home together at any point during your marriage, the home would probably be considered marital property.

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Wheaton prenup attorney

Although television and movies have sometimes presented prenuptial agreements (also known as prenups) in a negative way, there are a multitude of benefits to drafting a premarital or prenuptial agreement. Not only does a prenup protect the financial interests of both spouses, it also helps facilitate open communication about financial expectations before the couple gets married. However, it is important to remember that prenuptial agreements must meet certain criteria in order to be legally enforceable. There are several problems which can invalidate a prenuptial agreement.

Premarital Agreements Must Be Written and Agreed to By Both Parties

Studies show that disagreements about money are among the most common reasons couples get divorced. Having an open and honest conversation about financial expectations before walking down the aisle is one way to avoid financial disagreements during the marriage. In a prenuptial agreement, couples will decide how they will handle issues such as property division and spousal maintenance (alimony) if they end up divorcing. The agreement can also contain information about how debts will be distributed in the event of divorce. The prenuptial agreement cannot be a verbal contract; it must be written and signed by both spouses.

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Lombard divorce lawyer for division of propertyMarriage is like a knot, and that knot can be very tricky to untie if you are getting a divorce. One of the most difficult parts of divorce can be the division of property. Many states use “community property” laws, which say that any assets obtained during a marriage are subject to equal division in the case of a divorce. However, Illinois is not a community property state, and instead, it uses a principle known as “equitable distribution.” This states that assets will be fairly and equitably divided between spouses in just proportions rather than being split 50/50.

Types of Property

There are two types of property that a married couple may own: marital property and separate property. Marital property is defined as all assets and debts obtained by either spouse during a marriage. This includes not just tangible property but also intangible assets. Examples may include vehicles, furniture, clothing, jewelry, bank accounts, trusts, real estate property, and business interests--as long as they were obtained during the marriage. Liabilities such as credit card debts or home and auto loans are also considered marital property. 

Separate property includes any assets that were obtained by one spouse before or after the marriage, as well as any inheritances given solely to one spouse. Marital property will be divided between spouses, but separate property will continue to be owned by the spouse that acquired it.

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Posted on in Divorce

DuPage County divorce lawyersWhen navigating the divorce process, it is common for parties to feel discomfort while going over contentious issues. For many, the most contentious issues revolve around a couple's marital property. Regardless of the economic position of the couple, property division can include nuanced financial portfolios, valuable assets, and land property. As you and your legal team prepare for the divorce process, it is important to first gain an understanding of marital property division.

What Constitutes Marital Property

Here in Illinois, marital assets must be equitably distributed. To be clear, that simply means that all marital property must be divided fairly (not equally). Before a court can make any decision concerning marital assets, they must first determine what property is marital and what property is non-marital.

According to Illinois State Law, marital property is defined as property acquired during the marriage. Marital assets can range from real estate and vehicles to bank accounts and business interests. Non-marital assets include real estate acquired prior to the marriage, property or assets that are excluded because of a prenuptial or postnuptial agreement, and property or assets that were purchased with nonmarital assets.

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The Stogsdill Law Firm, P.C.

Ending a marriage has the potential to make things a little tighter financially, at least for a little while. Trying to maintain the same lifestyle after a divorce can be more challenging, since the individual has only one income to draw from instead of two. Recent changes in tax law can also affect strategy for individuals during property division in divorce. Individuals in Illinois who are contemplating ending a marriage may also want to consider how their long-term retirement needs will be affected.

Households that have been through a divorce face a higher risk of being unable to maintain their current standard of living in retirement. The reason is simple: sharing household expenses makes life more affordable. However, careful planning and management of assets can aid individual households after divorce.

Divorces that are finalized after the new alimony rules take effect next year may see changes. Since the lower earning spouse may find him or herself in a much lower tax bracket due to not having to claim alimony as income, it may be to his or her advantage to receive investment assets rather than the marital home during the settlement of the divorce. These assets, if they come as traditional retirement assets, may be more easily converted into a Roth IRA that can offer additional tax benefits.

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