If you’re in the midst of a divorce in Maryland, you may have concerns about how your assets will be divided. This process can include many different factors, from when property was acquired to how property is categorized. Forbes explains some general information on how property and assets are commonly divided (although it can depend on your specific situation).
What Is Separate Property?
Only those assets that are considered marital property can be divided during a divorce. That means that any property deemed separate will remain in the possession of the spouse who owned it in the first place. While the actual definition of separate property can differ from state to state, in general it entails assets/property that was owned by either spouse before the marriage took place, inheritances received before or during the marriage, and third-party gifts provided to either spouse.
What Is Marital Property?
Regarding marital property, all property that is acquired during the course of a marriage is usually considered marital property. This includes property that is in the name of one or the other spouse. For example, 401Ks, stocks, retirement plans, mutual funds, real estate, commissions, and all other types of income/assets obtained during the course of the marriage can be construed as shared property despite how they are titled.
What Does Equitable Distribution Mean?
Maryland is an equitable distribution state. As compared to community property states (which require a 50/50 split of marital assets), equitable distribution means that divisions must be fair, but not necessarily equal. When determining fair division, the court will look at a number of factors. For instance, how long your marriage lasted is bound to be considered, as are the respective financial status of each spouse upon divorce. Financial contributions during the marriage will also be looked at, along with age, earning potential, standard of living during the marriage, and the financial needs of the custodial parent.