New York Property and Debt Division in a New York Divorce

How property and debts are divided when you get divorced.

If parties agree on all aspects of the divorce, this may include property division. In cases of fault-based divorce, the judge in New York will apply the traditional rules of "equitable distribution".

This means that the judge can do whatever he or she thinks is fair.  However, there are broad guidelines relating to the property division. In marriages of long duration property acquired during the marriage is generally divided on a 50/50 basis. The ratio would be different for shorter marriages. The court also considers which party contributed more assets to the marriage.

In New York, other property, or "separate property" remains with the party who owns it.  If separate cash is contributed to a joint bank account, and treated as joint funds, it will generally become marital property.  The party who made the deposit may be entitled to reimbursement for the initial deposit, but not for the eventual value of the funds as invested.

What is separate property?

  • Property acquired before marriage; by inheritance or  by gift from someone other than the spouse.
  • Compensation for personal injuries.
  • Property acquired in exchange for separate property.
  • The increase in value of separate property (such as stock appreciation, interest, or real estate appreciation).
  • Property described as separate property by written agreement of the parties.

How is property divided at divorce?

It is common for a divorcing couple to decide about dividing their property and debts themselves, rather than leave it to the judge. But if a couple cannot agree, they can submit their property dispute to the court, which will use state law to divide the property.

Division of property does not necessarily mean a physical division. Rather, the court awards each spouse a percentage of the total value of the property. (It is illegal for either spouse to hide assets in order to shield them from property division.) Each spouse gets items whose worth adds up to his or her percentage.

How do we distinguish between marital and non-non-marital property?

Very generally, here are the rules for determining what's Marital property and what isn't:

  • Marital property includes all earnings during marriage and everything acquired with those earnings. All debts incurred during marriage, unless the creditor was specifically looking to the separate property of one spouse for payment, are marital property debts.
  • Non-marital property of one spouse includes gifts and inheritances given just to that spouse, personal injury awards received by that spouse, and the proceeds of a pension that vested (that is, the pensioner became legally entitled to receive it) before marriage. Property purchased with the separate funds of a spouse remain that spouse's separate property. A business owned by one spouse before the marriage remains his or her separate property during the marriage, although a portion of it may be considered Marital property if the business increased in value during the marriage or both spouses worked at it.
  • Property purchased with a combination of separate and marital funds is part marital and part non-marital property, so long as a spouse is able to show that some separate funds were used. Non-marital property mixed together with marital property generally becomes marital property.

Who gets to live in the house during the divorce?

If children are involved, the parent who spends the most time with the kids, or provides their primary care, usually remains in the marital home with them. If you don't have children and the house is the separate property of just one spouse, that spouse has the legal right to ask the other to leave.

If, however, you don't have children and you own the house together, this question gets tricky. Neither of you has a legal right to kick the other out. You can request that the other person leave, but he or she doesn't have to. If your spouse changes the locks, or somehow prevents you from entering the home, you can call the police. The police will probably direct your spouse to open the door. When you both own the home, the only time you can get your spouse to leave is if domestic violence has been committed and a judge grants a restraining order.

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