Property Division Under Virginia Law
When a marriage ends, the couple must divide up
their property and possessions. Either the couple can agree between themselves
how to do this or the court will decide for them.
Everything with exchangeable
value or anything that goes to makeup a person's wealth: every interest,
estate, obligation, right. Anything that you own or that generates income is
considered by the law under the category of property:
How does the law divide property?
Non-Marital property refers
to property acquired before marriage, through inheritance or by gift from a
3rd party, excluded by a valid agreement between parties; property directly
traceable to any of these sources.
In the absence of an agreement between parties, The court (judge) will decide what property is to be considered marital property. Although the court cannot transfer the title of property from one spouse to another (except for pensions and the like), it can make a money award to one party to compensate for the other party keeping the property. In the case that property falls into both categories such as a car that was purchased in part with money from one partner's nonmarital funds and in part with marital funds, the court will determine what percentage of the car is marital property and what percentage is nonmarital and factor this into the monetary award when the property settlement is decreed. (It can also order the sale of the property and division of the proceeds.) The court will also consider issues of alimony/spousal support in determining property settlement issues.
Factors to be taken into
account in determining the amount of the monetary award to both parties:
Consider: Did you concentrate
on homemaking and childrearing to the exclusion of generating an income
that would have enabled you to bring property into the marital unit? Did you
put your spouse through school? Did you bring money into the marriage that
you earned when you were single, or that came from an inheritance, etc. and
mingle it with family funds?
Consider: Do you or your
spouse have considerable property that the court will consider nonmarital
and that can generate an income for you? This will affect any monetary
Consider: Even though fault
(adultery, desertion) are not supposed to be grounds for denial of a
monetary award, there still may be some impact if the case seems pretty
Consider: See #5 above. This
situation will be compounded in a long term marriage particularly if the
dependent spouse is sick.
award or other provision which the
court has made with respect to family use personal property or the family
home, and any award of alimony:
between Monetary Award and Alimony
Types of Property
There are two types of
property. One type of property is real property, which is real estate. The
other type is personal property, such as securities, bonds, bank accounts,
automobiles, household furniture, jewelry, paintings, books, record
collections, and the family dog, to mention a few.
Real property includes all real estate. It includes your home, beach house, condominium, or that interest in some real estate investment held in both your names, or titled solely in one spouse's name or held by another for your benefit.
There are several options available to deal with real property in your Separation Agreement. First, one spouse can sign over their entire interest in the property to the other spouse. Second, both spouses can agree to the sale of the property. Third, another practice often followed is giving the right to one of the parties (usually the custodial parent) to remain in the home for a certain period of time, particularly until the children reach their age of majority or become selfsupporting. Another possibility is to allow one party to remain in the home, to have the house appraised, to fix the equities of the parties as of that date, then to allocate whatever appreciation may be attributable to the house to the party who then continues to make the payments, and that person gets whatever increase or decrease in value there may be at the time that the house is actually sold. There are other questions, too. If one of the parties remains in the house and that person makes the payments on the house, does that person also get the tax advantages, which include the interest payments and state property taxes as a deduction on his/her income tax return? Or does the other spouse, who is perhaps paying support as well as house payments, have the benefit of that deduction?
With any real estate, similar agreements or tradeoff of interest in properties can be made. Some examples are as follows: (1) a husband could sign over the family home to the wife in exchange for the wife signing over to him the beach property and her interest in his share of their investment in their real estate syndicate. (2) the wife could sign all properties, other than the family home, over to the husband in exchange for the husband paying a greater sum in spousal support. (3) the husband could pay a lump sum to the wife in exchange for her signing over her interest in any real estate to him.
Often, one spouse desires to
purchase the other's interest in joint real estate. You may wish to hire one
or two independent, licensed appraisers to determine the fair market value
of the property before you and your spouse decide on any "buy out" terms.
Again, you cannot be overly cautious in considering tax consequences. Be
sure to check with your tax adviser before any "buy out" between you and
Personal property includes
items such as securities, bonds, savings accounts, checking accounts,
retirement funds, retirement accounts, pensions, automobiles, household
furniture, jewelry, books, record collections, paintings, and/or other
objects of art. Any of these items can be used as a tradeoff for other
items. A separation agreement should definitely contain some provision as to
what should be done with all these accumulated goods.