What Types of Property Will I Need to Address During My Divorce?

 Posted on December 11, 2023 in Divorce

The divorce process may involve a number of challenges. You and your spouse will need to make decisions about how a variety of legal and financial subjects will be addressed. One of the most important financial aspects of the divorce process involves dividing marital property between you and your spouse. In Illinois, property division follows what are called equitable distribution laws, and so under those laws, assets and debts acquired during your marriage will be divided fairly, but you are not required to split everything in half and equalize the share of the marital estate that each party will receive.

As you deal with subjects related to your marital property and other financial matters during your divorce, it is crucial to understand what types of property get dealt with. Consulting with an experienced family law attorney will give you a strong understanding of what assets are included in your marital estate, and how property may be valued and divided.

Marital Property vs. Separate Property

Before delving into specific types of property that need to be addressed during a divorce, it is important to understand the distinction between marital property and separate property:

Marital property refers to assets and debts acquired by either spouse during the course of your marriage up until your legal separation. This includes income earned by both parties and deposited into joint or separate accounts, any real estate purchased after getting married, vehicles bought during your marriage, retirement accounts or other benefits accumulated while married, and any other assets obtained using funds earned or acquired during your marriage. Regardless of whose income was used to make certain purchases, or who primarily used different items, anything you acquired while you have been married will be considered marital property.

Separate property generally includes assets owned by each spouse before getting married. It will also include certain gifts or inheritances received individually by either spouse throughout the marriage. Property acquired in exchange for separately owned assets, such as a car purchased with funds a spouse received as an inheritance, will be considered separate property. However, if separate property becomes intermingled or commingled with marital property, such as by depositing personal funds into joint accounts, these assets may potentially lose their status as separate property, and they may need to be considered during the property division process.

Determining Equitable Distribution

Under Illinois law, marital property should be divided between divorcing spouses in a manner that is considered fair or just by the court. Fair distribution does not necessarily mean an equal 50/50 split, as courts take into account various factors such as:

• The spouses' contributions to acquiring marital property;

• Each spouse's economic circumstances, including the income they currently earn and the separate property they own;

• The length of the marriage;

• The standard of living established during the marriage;

• Custodial arrangements for children, and how these may affect the desirability of maintaining ownership of the family home or other assets;

• Any prenuptial or postnuptial agreements entered into by spouses that detail how certain marital assets will be divided in the event of divorce; and,

• The tax consequences that may apply to each spouse based on decisions related to the division of different assets.

Types of Property Subject to Division

During divorce proceedings, numerous types of property may need to be addressed and divided between spouses:

• Homes and real estate: The family home can be one of the most significant assets subject to division, and, in addition to a couple’s primary residence, vacation homes, rental properties, and undeveloped land will also need to be considered. 

• Furniture and household items: Items like bedroom sets, living room furniture, appliances, electronics, collectibles, & antiques may need to be addressed when dividing property. 

• Vehicles: This category includes cars, motorcycles, boats, recreational vehicles (RVs), trailers, and other types of vehicles acquired during the marriage.

• Financial accounts: All bank accounts held jointly or individually fall under this category, including checking accounts used for daily expenses, along with savings accounts meant for emergencies or future planning. 

• Pensions and retirement assets: Pensions, 401(k) plans, IRAs, and other retirement accounts accumulated during the marriage may need to be evaluated, and Qualified Domestic Relations Orders (QDROs) may be used to divide these assets, while avoiding potential taxes or penalties for early withdrawal of funds.

• Investments: Stocks, bonds, mutual funds, and other investment holdings may come into play when assessing assets subject to division. 

• Business interests: If either spouse owns a business or has an ownership stake in a company acquired while they were married, the business may need to be appraised to determine its value, and decisions may need to be made about whether one party will buy out the other's interest in the company. 

• Digital assets: Ownership of online accounts such as email addresses, social media profiles, websites, or blogs with monetization potential may need to be addressed, and assets such as cryptocurrency may also need to be evaluated and divided. 

• Pets: Even though family pets are considered property, Illinois law states that their best interests may be considered when making decisions about ownership.

• Debts: In addition to assets, a couple may also need to determine who will be responsible for paying back loans, credit card balances, or other debts acquired while they were married.

Contact Our Oak Park Marital Property Division Attorney

If you are currently going through a divorce, or if you are planning to take steps to end your marriage, it is essential to seek guidance from an experienced divorce attorney who can advise you of your rights and help you make decisions that will benefit you financially. At Law Office of Vincent C. Machroli, P.C., our Hillside property division lawyer will work with you to address issues related to your marital assets, while advocating for solutions that will allow your property to be divided fairly. Contact us today at 708-449-7404 to schedule a free consultation and learn how we can help you complete your divorce successfully.