Search Site
Menu
 Whippany, New Jersey | New York, New York
Free 30-Minute Consultation 973-428-0800

When parties’ divorce, there is a distribution of the assets and debts acquired during the marriage.  This is called equitable distribution.  Assets which are not subject to equitable distribution are any of those which belonged to a party before the marriage, such as inheritance and gifts and individually owned property.  These are the individual’s property and are not divided in the event of a divorce.

Once a party comingles an individual asset into a joint asset, it is no longer individual property.  For example, if a wife contributes $50,000 of her inheritance into a down payment on the marital home, that $50,000 becomes marital property and if there is a divorce, she is not entitled to the $50,000 back.  The sale price of the house can be divided without refunding her individual contribution to it.

Financial planning and accurate information are essential to properly valuing and distributing the assets and to be aware of tax consequences. It can be advisable to have the assistance of a CPA.

Certain issues must be carefully evaluated.  A house worth $400,000 is not equal to $400,000 cash.  There are costs of selling the house and taxes to be paid.  A $400,000 IRA is not the same value as the $400,000 house or straight cash of $400,000.  The IRA is tax deferred.  If it is not rolled over into another IRA and is liquidated, the tax for the premature distribution becomes due.

Another form of marital property is stock options.  These are a deferred compensation benefit.  They may not be exercised until a future date sometimes after the parties’ divorce.

Marital property is that which is acquired during the marriage. Another marital asset can be a pension called a defined benefit.  It can be acquired during the marriage, but paid out only during retirement.  A coverture fraction is used to divide retirement benefits.  The denominator is the years over which the stock options or pension was earned.  The numerator is the total years in that period in which the marriage existed.

Stock options can vest at different periods of time.  The stock option plan describes the purpose of the plan.  The important issue is whether the work required to earn the options was put forth during the marriage.

Marital debts are also subject to equitable distribution.  Common marital debts are mortgages, car loans, and credit cards.  The simplest picture is where the marital house is sold, the mortgage balance is deducted and the parties split the remaining equity.  If the marital home is not sold and the party who keeps it cannot buy out the other, if the mortgage is in both names, both remain liable after the divorce.

Sometimes the party remaining in the home will execute a hold harmless agreement.  This does not suffice to protect the other spouse because the contract is with the bank.  If the remaining spouse defaults on the mortgage, the other spouse is still responsible for it.

Credit cards may be in one person’s name, but can be considered as marital debt.  If the credit cards were used for ordinary household items, restaurants, trips, and clothing, a Court can rule that it is marital debt.  Unless a party can prove that the charges were made for a paramour, for example, they will not be considered as separate debt.

Dissipation of marital assets means that an asset that was acquired during the marriage and that is subject to equitable distribution has been disposed of improperly to deprive the spouse of his/her share.

If a party believes this is occurring, a Motion can be made to the court to freeze certain assets.  It is important to know what the asset is.  Bank accounts and securities, transfers of real estate deeded in one name can be dissipated.  A party can dissipate marital assets by regularly sending money to one’s parents in a foreign country without the knowledge or consent of the other spouse.  The improper withholding of business records and obstruction of discovery can be an attempt to deprive the other of his/her share.

There are many procedures used in a matrimonial case to ensure that there is full disclosure.  It is, of course, advisable for both spouses to be aware of the family finances during the marriage.  However, even if one spouse does not have this information, it will be revealed through discovery techniques and Court enforcement, if necessary.

If the parties cannot settle this equitable distribution, the Court will determine it based on the following considerations:

  1. The duration of the marriage or civil union;
  2. The age and physical and emotional health of the parties;
  3. The income or property brought to the marriage or civil union by each party;
  4. The standard of living established during the marriage or civil union;
  5. Any written agreement made by the parties before or during the marriage or civil union concerning an arrangement of property distribution;
  6. The economic circumstances of each party at the time the division of property becomes effective;
  7. The income and earning capacity of each party, including education background, training, employment skills, work experience, length of absence from the job market, custodial responsibilities for children, and the time and expense necessary to acquire sufficient education or training to enable the party to become self-supporting at a standard of living reasonably comparable to that enjoyed during the marriage or civil union;
  8. The contribution by each party to the education, training or earning power of the other;
  9. The contribution of each party to the acquisition, dissipation, preservation, depreciation or appreciation in the amount or value of the marital property, as well as the contribution of a party as a homemaker;
  10. The tax consequences of the proposed distribution to each party;
  11. The present value of the property;
  12. The need of a parent who has physical custody of a child to own or occupy the marital civil union residence and to use or own the household effects;
  13. The debts and liabilities of the parties;
  14. The need for creation now, or in the future, of a trust fund to secure reasonably foreseeable medical or educational costs for a spouse or children; and
  15. Any other factors which the Court may deem relevant.

Tanya N. Helfand, Esq. concentrates in Family Law.  The firm works with clients throughout New Jersey and New York.  Helfand & Associates’ office is located at 575 Route 10 East, Whippany, New Jersey, telephone number 973-428-0800.  The firm frequently handles the successful resolution of complicated financial cases. We offer a free half hour consultation.

Tanya N. Helfand, Esq., is a Certified Matrimonial Attorney, a mediator and Panelist in the Morris and Essex County ESP Programs.  The firm welcomes your questions and inquiries at [email protected].

 

Contact us

Please fill out the form below and one of our attorneys will contact you.

Quick Contact Form

Our Offices
  • Whippany Office
    575 Route 10 East
    Suite 1
    Whippany, New Jersey 07981
    Phone: 973-428-0800
    Fax: 973-428-0830
  • New York Office
    420 Lexington Ave.
    New York, New York 10170
    Phone: 646-213-9053
Testimonials
  • "Without Tanya and her time, the really unpleasant experience of getting divorced would have been even worse. They were able to settle the matter very quickly and helped me fit this into my tight schedule allowing me to leave to move abroad for my dissertation research on time without having to delay the trip because of the divorce. They also did all of it within my very tight budget. Thank you so much for your help and dedication to my legal matter!"  - AG

  • "Tanya and her Associates are outstanding! What I admire most about Tanya is her knowledge of the law with her keen negotiation skills to foster mediation. Her strategies efficiently resolve conflict leading to the resolution of cases. She and her team have an outstanding work ethic, know what data are needed, and get the job done. It is a pleasure to work with such wonderful professionals."  - Tara, Whippany

  • "I found Ms. Helfand's knowledge and tenacity most reassuring during the ordeal of my divorce. She was steadfast in her guidance and was very effective in her negotiations on my behalf. I would recommend her without a second thought. "  -Jonathan

  • "Ms. Helfand was very professional and helpful with our bankruptcy case. Her advice was very useful and helped us make the proper decisions for our situation. In addition, she was very supportive during a very difficult time for us. Finally, she set very specific fee expectations and there were no surprises when it was completed. I would use her services again and would recommend her, without question."

  • "She is Incredible, very quick responding to the other party. Very professional and courteous. I highly recommend her. She has a great passion and love for every single case."

  • "Tanya and her team were very professional handling my divorce proceedings. She was very proactive in making the other attorney finally get the process moving forward. I would recommend her to anyone looking for legal services. "  -Scott

  • "Ms. Helfand strategized & processed, both, my Divorce & Chapter 13 Bankruptcy. As both cases were emotionally and legally challenging, Ms. Helfand proved to be an empowering Mentor along the path to clarity for which I am truly grateful. I highly recommend her legal expertise to anyone who is seeking a confident, savvy & caring attorney to become at peace with self and any legal matters."  -Vas

Media
Videos View All

Podcasts
view All

Press Releases