Englewood Divorce Attorney
Helping NJ Clients Identify and Appraise their Marital Estate
Before a New Jersey divorce can be finalized, the “marital estate” must be divided between the parties. The initial step in this process is full disclosure by both spouses of all assets and debts without concern for whether they are marital property or not. After full disclosure has been accomplished, the next step is determining which assets and debts are marital property. Items that are excluded are given to one of the parties. Then, a value is placed on the assets and debts included in the estate so that it can be divided.
The Marital Estate
As a general rule, the marital estate includes all property and debt acquired by either party during their marriage. Property that is not part of the marital estate is any property obtained during the marriage by one spouse through an inheritance or a gift and any increase in the property’s value. However, non-marital property may become marital when it is mixed in with marital property (commingled).
Preliminary Determination of the Marital Estate
After each spouse fully discloses all assets and liabilities, the next step is to make a preliminary determination of whether the disclosed items are part of the estate or not. Some assets and liabilities may be quickly excluded from the marital estate. In this case, it may be unnecessary to determine the value of excluded items.
For example, a couple may agree that an antique gold watch (asset) given to the husband by his grandfather will not be part of the marital estate. Consequently, having the watch appraised is unnecessary. In another example, the wife may admit that she had incurred gambling debts (liabilities) and both parties agree that they were solely hers. In this case, the existence of the debts is disclosed and the assignment to the responsible party is recognized, but a determination of value is not made.
If the inclusion or exclusion of an item from the marital estate is in question, it is tentatively left in and valued. The purpose of the valuation is to determine the relative importance of the item. Simply put, if the item is relatively unimportant to either spouse or has small value, the parties may recognize that the item is not worth arguing about and provide for its disposition quickly.
After preliminary exclusions have been established, the values of the remaining assets and liabilities are determined. The purpose of these valuation procedures is to break the marital estate down do the dollar value of the assets and liabilities. Consequently, the complexity of the valuation process depends on the types of assets and liabilities involved and the contentiousness of the couple.
For example, if the marital estate consists only of one vehicle each and joint credit card debt, the valuation procedure may consist of getting retail values of the vehicles from the Internet and having the couple show their most current credit card statements. The couple may agree that they have little to contest and the divorce can be completed very quickly.
However, if the parties own many pieces of real property including investment properties, have a significant amount of debt, and are highly contentious, then the valuation process may take extensive work. This may include the gathering of information and the involvement of several outside experts.
Contact An Englewood Cliffs Property Distribution Attorney
If you would like to contact an Englewood family lawyer at The Radol Law Firm to discuss your legal situation. Our firm has extensive experience in accounting and business law and is skilled at valuing businesses, retirement accounts, real estate, and other marital property. For quality legal support through your family law matter, contact The Radol Law Firm for an initial consultation.