Division of Assets
New York is an equitable distribution state, unlike a community property state where all assets are divided equally between spouses, the Domestic Relations Law divides assets based upon what is equitable or fair.
The law divides property into two categories: marital property and separate property. Marital property consist of all assets that were acquired by the husband and wife during the marriage. It does not matter whose name the assets are titled in, every asset purchased or acquired during the marriage is marital property. Separate property is an asset that was acquired prior to the marriage, for example: a personal injury settlement received during the marriage or an inheritance.
In a divorce action, all assets and property are divided between the parties. This includes 401(k)’s, IRA’s, pension plans, personal property, bank accounts, businesses, and vehicles to name few.
During the divorce action, the attorneys conduct a process called discovery where they gather information and create a list of all assets and debts, and then value the assets and debts as of the date of commencement (that date the divorce started).
If attorneys and parties are willing to work together, creative solutions can be found to protect certain assets such as a 401(k) in exchange for waiving an interest in another asset, such equity in a house. The Collaborative Law process focus is energy in finding the most creative solutions for parties while involving the assistance of outside professionals, such as a financial advisor or CPA, to find the best solution to divide assets.