Navigating Property Division During a Divorce in Minnesota
Divorce can be a challenging and emotionally charged process, and one of the most significant aspects to address in many cases is the division of property. Often, divorcing parties worry both about losing everything they worked for during the marriage and what life will look like after the divorce is complete.
In Minnesota, property division is governed by specific laws and guidelines that aim to ensure a fair and equitable distribution of assets and liabilities between spouses, without regard to any martial misconduct. (Minn. Stat. § 518.58)
1. Equitable Distribution Principle:
In Minnesota, property division follows the principle of equitable distribution. This means that marital property is divided fairly—though not necessarily equally—between spouses.
2. Marital vs. Non-Marital Property:
To begin the property division process, it’s essential to distinguish between marital and non-marital property:
- Marital Property: Generally, this includes all assets and debts acquired during the marriage, regardless of which spouse earned or acquired them or whose name they are in. Exceptions may include gifts or inheritances designated for one spouse only.
- Non-Marital Property: This category comprises assets and debts acquired by either spouse before the marriage or after a legal separation or gifts/inheritances to one spouse only. It also includes items explicitly defined as non-marital in a prenuptial or postnuptial agreement.
- Valuing and Dividing Marital Property: Once the marital property is identified, the next step is to value and divide it. This process can involve various types of assets, including:
- Real Estate: Homes, vacation properties, and rental properties are appraised to determine their value.
- Financial Assets: Bank accounts, retirement accounts, stocks, and investments are assessed based on their current worth.
- Personal Property: Items such as vehicles, furniture, jewelry, and collectibles are evaluated for their fair market value.
- Debts: Marital debts, including mortgages, loans, and credit card balances, are considered jointly, and a fair distribution is determined
3. Factors Considered in Equitable Distribution:
The court bases its findings as to what is equitable on a number of factors such as:
- The Length of the Marriage. The length of the marriage can influence the division. Longer marriages may lead to a more equal distribution of marital property.
- Contributions of Each Spouse. The court assesses the contributions of each spouse, both financial and non-financial, to the acquisition and maintenance of marital property.
- Economic Circumstances. The current and future financial situations of both spouses are considered. This includes their earning capacities, needs, and assets.
- Custody Arrangements. If children are involved, the court may factor in the custody arrangement when dividing property to ensure the children’s best interests are met.
- Debts and Liabilities. Marital debts, such as mortgages and loans, are also divided equitably between the spouses.
However, even with these considerations, the court conclusively presumes that each spouse made a substantial contribution to the acquisition of income and property while they were living together as husband and wife.
4. Spousal Maintenance (Alimony):
In some cases, one spouse may be entitled to spousal maintenance, commonly referred to as alimony. This is financial support provided by one spouse to the other after the divorce. The court considers factors like the length of the marriage, each spouse’s income, and their financial needs when determining whether spousal maintenance is appropriate.
However, a spouse can be provided a larger portion of parties’ property in exchange for lowering or waiving spousal maintenance.
- Methods of Division:
- Voluntary Agreement. Spouses can work together to create a property settlement agreement that outlines how assets and debts will be divided. This is often the preferred method, as it allows couples to have more control over the outcome.
- Alternative Dispute Resolution. Mediation or evaluations may be utilized to help couples reach an agreement outside of court.
- Court Decision. Having a court decide property division is often a last resort if spouses cannot agree on property division. A judge will make decisions based on the aforementioned factors to determine an equitable distribution of assets and debts.
Navigating property division during a divorce in Minnesota can be complex, but understanding the principles of equitable distribution, distinguishing between marital and non-marital property, and considering the various factors that influence the court’s decision can help you prepare for this aspect of the divorce process.
Consulting with an experienced family law attorney is often a wise step to ensure your rights and interests are protected during this critical phase of divorce proceedings. Oney + Kim Family Law attorneys can guide you through the right strategy to preserve your fair share of property and secure your future after your divorce. You can contact us via email or call us at 612-279-8655.