When a marriage ends in divorce, a large portion of the process involves dividing the marital assets between the two spouses. While property division is equal in a few states, Virginia and most other states use a system of equitable distribution, the goal of which is to ensure that neither spouse will struggle financially after the divorce. However, in order to divide the assets, it must be clear which assets are jointly owned and which belong only to one spouse.
Separate property includes anything either spouse owned before they got married. It may also include individual gifts, inheritances or personal injury awards. The trouble is that many spouses commingle those individual assets after they marry. This can include any of the following actions:
- Adding personal funds to a joint account
- Using a monetary inheritance to buy, renovate or repair the family home
- Earning real estate gains, interest or other increases in individual assets during the marriage
- Adding a spouse’s name to an individual investment or retirement account
- Using an inherited home for a family vacation property
- Using individual funds to finance a spouse’s business
These and other types of commingling can create a mess when it comes time to divide marital assets. In some cases, only a percentage of an individual asset may be on the table for property division, but in other cases, the entire value of the asset is on the line. The longer the marriage, the more likely and complex commingling will be. Couples who marry with separate property would be wise to retain as much documentation about their assets from before and during the marriage to facilitate any division during a divorce.