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shutterstock_1195555699.jpgWhen a couple chooses to end their marriage, they will need to address a variety of issues during the divorce process. Foremost among these is the division of marital property. All assets and debts that a couple owns together must be divided fairly and equitably. In addition to marital property, each spouse will likely have certain assets that are considered separate property, including items they owned before getting married, assets received through inheritances, and property excluded from the marital estate by a prenuptial or postnuptial agreement. Separate property will not be divided between spouses, and each party will be able to retain ownership of the assets they originally possessed. However, there are many situations where marital and separate property may become mixed together or “commingled.” By understanding how to identify marital and separate property and determine how ownership of commingled property will be handled, spouses can ensure that property division will be addressed correctly during their divorce.

Examples of Commingled Property

It is not always easy to determine which assets may be considered separate property vs. marital property, especially when a couple has combined their finances during the years that they were married. When assets become commingled, it may sometimes be possible to trace them back to their source, but if this is not possible, separate property may be “transmuted” into marital property, and it will need to be included during the property division process. Some cases where commingling of assets may occur include:

  • Real estate property - A home or other property that one spouse owned before getting married will be considered separate property. However, some of this asset may be considered marital property if the other spouse made contributions toward its increase in value. For example, if payments on a home’s mortgage were made using income earned by both spouses, the increase in equity in the home may be considered to be a marital asset. Similarly, if a spouse helped make improvements to a home owned by the other spouse, such as by performing work or helping make payments to a contractor, they may be able to claim partial ownership of the home. To ensure that they can maintain full ownership of the property, the spouse who originally owned the home may reimburse the other spouse for the contributions they have made.

St. Charles divorce lawyerThere are multiple types of financial issues that can play a role in a divorce case. Determining how to divide marital property in a way that is fair while providing for the needs of both parties can be complicated enough on its own, but in some cases, additional issues may arise that can make this process even more difficult. Asset dissipation in which one spouse wastes or destroys marital property is one factor that may need to be addressed. A person who believes that their spouse has dissipated assets can work with an attorney to ensure that this issue is dealt with properly during the property division process.

Ways a Spouse May Dissipate Assets

Dissipation of assets involves the use of marital property by one spouse in a way that benefits themselves and is not related to their marriage or family. A valid dissipation claim must show that dissipation occurred while the marriage was undergoing an irretrievable breakdown. Some of the most common ways that a spouse may commit asset dissipation include:

  • Affairs - An extramarital affair definitely falls into the category of activities that are unrelated to a couple’s marriage. When a spouse commits infidelity, they are likely to secretly use marital funds to further their affair. This may include buying gifts for the person they are cheating with, spending money on hotel rooms or trips to other cities, or giving away items that are considered marital property.

Kane County divorce lawyerGetting a divorce can be a stressful experience, especially if you feel like your life is being completely upended as you separate from your spouse. As you determine how to divide your marital property and address other financial matters, one issue that will need to be resolved is ownership of your family home. Being attached to the home where you have lived is understandable, and you may wish to continue living there after completing your divorce. However, you will want to be sure to understand the ramifications of this decision and make sure you will be positioned for financial success as you move on following the end of your marriage.

Reasons to Keep the Family Home

Maintaining ownership of your home may seem like the ideal outcome in your divorce, especially if you have lived there for a significant time, built connections with others in your community, and want your children to continue to live in the home they have become accustomed to. After spending years making mortgage payments and building equity in your home, you may not want to give up this valuable asset, especially if you have made improvements and put your own personal touch on the property.

If you believe that you will be able to cover the costs of homeownership, and you want to make sure your children will be able to stay in the same home, you may be able to negotiate a property settlement that will allow you to maintain sole ownership of this asset. If this will not be feasible, you and your spouse may agree to co-own the home for a certain period of time, such as until your children graduate from high school.

St. Charles IL divorce lawyerSo much of the conversation when we talk about divorce centers around the allocation of assets–property, money, investments. But a couple’s allocation of debt is often just as important, especially in an age where so many people carry the burden of enormous student loans.

Here, we will discuss different types of debt, the factors that can affect debt division, and the process by which debt is divided in an Illinois divorce.

Types of Debt

Marital assets and debts follow a similar pattern in a divorce. Debt that was owned by spouses prior to the marriage will generally be owned by that same spouse after a divorce. Debt that was taken on during the marriage is generally considered marital debt and will be divided between the spouses.

Kane County divorce lawyerEveryone knows that when a couple divorces, they split everything they own 50/50. Right? Wrong! Property division in divorce is actually much more complex than just throwing everything into a big pot and then splitting it down the middle.

In this blog, we will address some of the most common types of property that must be divided in a divorce, and how Illinois divorce courts tend to divide property. Keep in mind that Illinois is an “equitable distribution” state, meaning that rather than dividing assets 50/50, assets will be divided fairly according to a number of factors that the court will consider.

Homes and Land

The marital home is often the most valuable asset a couple owns together. Depending on whether the couple has children and one of the spouses wishes to stay in the home, the couple may choose to have one spouse buy out the other spouse’s value in the home, or sell the home and split the proceeds.

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