How Are Marital Assets Split in New York?

Divorce proceedings can be overwhelming, especially when it comes to dividing the assets you’ve accumulated during your marriage. If you’re facing divorce in New York, understanding how marital assets are divided can help you prepare for what lies ahead and make informed decisions about your future.

New York follows the legal principle of equitable distribution when splitting marital assets. This means that assets and debts are divided fairly based on the unique circumstances of each case — not necessarily in a 50/50 split. The court’s primary goal is to achieve a fair outcome that considers both spouses’ contributions and future needs.

Identifying Marital Property

Before any division can occur, the court must first distinguish between marital property and separate property. This distinction forms the foundation of the entire asset division process.

Marital Property

Any asset obtained by either spouse during the marriage is considered marital property and is subject to division. This includes:

• Real estate purchased during the marriage
• Bank accounts and investments acquired while married
• Retirement accounts and pensions earned during the marriage
• Business interests developed or expanded during the marriage
• Personal property like vehicles, furniture, and jewelry bought during the marriage

The key factor is when the asset was acquired, not whose name appears on the title.

Separate Property

Certain assets typically remain with their original owner and are not subject to division:

• Assets owned before the marriage
• Inheritances received by one spouse
• Gifts given specifically to one spouse
• Personal injury settlements awarded to one spouse

However, separate property can become marital property if it’s commingled with marital assets or used for marital purposes. For example, if you deposit an inheritance into a joint bank account, it may lose its separate property status.

Factors in Equitable Distribution

New York courts consider multiple factors when determining how to fairly divide marital assets. Understanding these factors can help you anticipate how your assets might be split.

1. Financial Circumstances

The court examines each spouse’s current financial situation, including income, assets, and debts. A spouse with significantly fewer financial resources may receive a larger portion of marital assets to help maintain their standard of living.

2. Contributions to the Marriage

Both financial and non-financial contributions are considered. This includes direct financial contributions, such as salary and investments, as well as indirect contributions, including homemaking, child-rearing, and supporting the other spouse’s career advancement.

3. Future Financial Prospects

The court evaluates each spouse’s earning potential, age, health, and employability. A spouse nearing retirement or with limited earning capacity may receive additional assets to secure their financial future.

4. Tax Consequences

The potential tax implications of asset transfers are factored into the distribution. The court aims to ensure that the tax burden is fairly shared between both parties.

How Courts Divide Assets

The actual division process involves several steps that ensure fair valuation and distribution of marital property.

Valuation of Assets

All marital assets must be properly valued before division. This may require professional appraisals for real estate, business interests, artwork, or other valuable items. Financial accounts and investments are typically valued as of a specific date, often the date of filing for divorce.

Dividing Specific Assets

Courts have several options for dividing marital assets:

• Direct division: One spouse receives the asset while the other receives assets of equal value
• Sale and split: Assets are sold, and proceeds are divided between spouses
• Continued joint ownership: In rare cases, spouses may continue to own property together (such as a family business)

The court considers practical factors like whether one spouse has a greater need for a particular asset or would be better positioned to manage it effectively.

Understanding Your Rights and Next Steps

The division of marital assets in New York is a complex process that requires careful consideration of multiple legal and financial factors. Each case is unique, and the outcome depends heavily on your specific circumstances, the length of your marriage, and the nature of your assets..

At The Law Offices of Diron Rutty, LLC, our experienced divorce attorneys in The Bronx are well-versed in handling complex asset division cases. We will work closely with you to understand your specific situation and goals and develop a personalized strategy to achieve a fair division of marital assets. Contact us today to schedule a consultation and learn how we can help you through this difficult time.