In Michigan divorces, courts strive for an equitable (though not necessarily precisely equal) division of property. In order to make a fair and just division, a judge will need to consider what assets are truly part of the marital estate and what they are really worth.
Separate or Marital Property?
In order to divide property, courts first need to consider whether assets owned by the parties are “separate” or “marital.” Separate property is typically not divided in a divorce; property that is marital is divided. Examples of separate property can include assets owned by one party before the marriage, assets inherited by one party during the marriage, and gifts received by one party during the marriage, even if from the other spouse. However, there are circumstances in which separate property is transformed into marital property, usually when separate assets are commingled with marital assets (for example, money inherited by one party is deposited in the couple’s joint bank account).
If the couple disagrees on whether certain property is separate or marital, the court will have to decide this question. To further complicate matters, there are some situations in which the court can award a party some of the other spouse’s separate property. This is is called “invading” separate property and is done only when necessary for the support of the invading party or when the invading party has contributed significantly to the acquisition or appreciation of the separate property.
Valuing Marital Property
It’s wise to make an inventory of all property you and your spouse own, whether you believe it to be separate or marital. If you have documentation of the value of an asset, such as an appraisal, include that information. For assets like bank accounts, brokerage accounts, and retirement accounts, it’s a good idea to make copies of statements.
When considering assets, don’t forget things like retirement accounts (e.g. IRAs and 401(k)s), earned but unpaid bonuses, stock in a corporation, goodwill in a family business, patents, and copyrights. Even the baseball card or coin collection that you think of as your spouse’s may be marital property if it was acquired during the marriage.
It is relatively easy to determine the value of some assets, such as a bank account. Others, like a family business, can be extremely difficult to value. It’s usually worthwhile to have such an asset professionally appraised. It does cost money to have a business valuation performed, but guessing at the value of a business, or accepting the figure your spouse puts forth, could cost you much, much more. The expense of a reliable appraiser is usually well-justified. An experienced family law attorney can help you select an appraiser whose work is known and trusted by the courts.
Protecting Marital Property During the Divorce
You will, of course, want to make sure that the marital assets you have stay right where they are during the divorce process. If there is any concern at all that the other partner might somehow waste marital assets, you should speak with your attorney about whether it may be advisable to seek a mutual restraining order to prevent this. A restraining order will prevent both of you from selling, hiding, transferring or otherwise dissipating marital assets during the course of the divorce, except as needed for expenses of daily living.
Schedule a Free Consultation with a Wayne County Divorce Attorney
Attorney Carlo Martina has been helping divorce clients safeguard their assets for over thirty years. He serves clients in Wayne, Washtenaw, Oakland, and Livingston counties. To schedule a consultation, call (734) 254-1140 or complete our contact form.