12th Oct 2014

Division of Assets

General rule of property division

Alabama is an equitable distribution state. Any division of property should be divided fairly and equitably, but not necessarily equally. There is no fixed standard to divide property, each case will be decided on its own merits.

The court has many means available to bring about the equitable division of property, including awarding jointly owned property to one spouse, transferring ownership from one spouse to another, or order that an asset be sold and divide the proceeds of the sale.

Does Misconduct of a Spouse Affect Property Division?

The misconduct of a party (e.g. adultery or abuse that led to the demise of the marriage) will be factored into the court’s division of assets. However, this is only one of the factors that the court will rely on.

How Does the Length of Marriage Affect Property Division?

Property division in an short-term marriage is usually straight forward. There is usually not a significant amount of joint assets and the court will usually tend to put the parties back in same financial position as they were prior to the marriage. Any joint assets are generally divided equitably.

Property distribution after a long-term marriage, the judge will usually start with an equal distribution of the marital estate. However, they will depart from this depending on what they consider to be equitable given the facts of the case.

Is Inherited Property Included in Property Division?

Property that was inherited is not considered in the division of assets unless marital assets have been used to improve or maintain the inherited property or income from the inherited property was used for the common benefit of the parties during the marriage.

Is Property that a Spouse Brought into the Marriage Included in Division of Property?

Generally, property that you brought into a marriage is given the same treatment as inherited property. If marital assets have been used to maintain or improve pre-marital property, or the income of the pre-marital property was used for the common benefit of the parties, then the pre-marital property can be included in the division of marital assets.

How is the Marital Home Treated in Dividing Property?

There are no special considerations for the marital home. However, the marital home is still subject to equitable distribution. Courts may award use and possession of the marital home to the custodial parent for a period of time, award the marital home to the custodial parent and other assets to the non-custodial parent, or order that the marital home be sold and the proceeds distributed equitably.

How do retirement plans get divided?

If the parties have been married for less than 10 years on the date of the filing of the divorce complaint, then the court is prohibited from distribution of the retirement accounts.

If the parties have been married for 10 years or more on the date of the filing of the divorce complaint, then the court has the discretion to award up to 50% of the retirement account of one spouse to the other spouse. This distribution is limited to the retirement benefits acquired during the marriage and to retirement benefits in which the spouse has a vested interest. This distribution must exclude retirement benefits and earnings acquired prior to the marriage.

These restrictions are applicable only to the court in deciding the matter. If the parties agree otherwise, the court may honor that agreement.

Division of Debts

The courts will equitably divide debts in much the same manner and in conjunction with the distribution of assets. The courts will equitable divide marital debts. This does not necessarily mean equal division.

If there is a debt that is associated with an asset (e.g. a car payment), then the court will generally assign the debt to the party taking the asset.

The division of debts is affected in the same way as division of assets with regards to the misconduct of the parties, length of marriage, and debts that the spouse brought into the marriage.

No matter what your divorce issue, you should discuss your options with a qualified divorce lawyer to protect your rights.

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