What is Complex Equitable Distribution in a North Carolina Divorce?
When a North Carolina couple decides to divorce, how do they divide their property? Divorcing spouses in Charlotte have the option to jointly agree to a property settlement agreement. A property settlement agreement lays out which spouse will own which property after the divorce is finalized. What happens when spouses cannot agree on how to divide their property? North Carolina has an equitable distribution statute that allows either spouse to file a motion in court requesting equitable distribution of the property.Experienced Charlotte Divorce Attorneys
When couples cannot agree on how to divide their property, the divorce process can quickly become contentious. If you are considering divorce or you are going through a divorce, hiring the right attorney is key. Spouses who do not have an attorney fighting in their corner often see most of their hard-earned assets go to the soon-to-be ex-spouse. At Arnold & Smith, PLLC our Charlotte divorce lawyers fight hard for our clients to keep as much property as possible after a divorce. Contact our law firm today to schedule your initial consultation.What is Complex Equitable Distribution in North Carolina?
North Carolina has a designated equitable distribution law. This law lays out a process through which a judge can determine how to fairly and equitably divide the property of two divorcing spouses. The policy goal behind the equitable distribution law is that a marriage is ultimately an economic partnership.
When two people are married, they take on debts together and they acquire assets together. Assets can include savings, motor vehicles, a home, and retirement accounts. Debts often include credit card debt, debt from a family business, car loans, and a home mortgage. When the couple divorces, they need to divide the property between the two spouses. The equitable distribution law provides judges with a way to fairly divide up both the assets and the debts taken on during the marriage.When Do North Carolina Judges Use Equitable Distribution?
North Carolina judges only use equitable distribution when certain requirements have been met, such as:
- The couple are married but are currently separated and living apart
- The equitable distribution claim is filed before the divorce is finalized
- There is no valid property settlement agreement or separation agreement that divides up the marital assets. When the spouses have signed a prenuptial or postnuptial agreement, a judge will enforce that agreement.
A spouse cannot file a motion for equitable distribution after the divorce is finalized. As long as all of the requirements above have been met, the spouse may file a claim for equitable distribution with the court.Identifying Property in Equitable Distribution Process
First, the court identifies which property is marital property and which property is separate property. Separate property includes all of the following:
- Property that a spouse owned before the marriage
- Property inherited by one spouse
- Gifts received by one individual spouse during the marriage
All other property is considered marital property. Marital property includes property acquired during the marriage by one or both spouses that both spouses owned before or on the date of separation. Marital property is subject to the equitable distribution process. Separate property is not part of the equitable distribution process. All separate property will go to the spouse who owns it after the divorce is finalized.
The equitable distribution statute assumes that all property acquired by one or both spouses during the marriage is marital property. If a spouse wants to claim that property is separate property, he or she needs to submit evidence to overcome this presumption.Valuing and Distributing Property in Equitable Distribution
Next, the court will assign a fair market value to every item that it considers marital property. Many times, courts appoint appraisers or other relevant experts to determine the value of the property. An item’s fair market value is the value another willing buyer would pay a willing seller to purchase the item.
Finally, the court distributes the property in a way that is equitable, or fair, to both parties. Equal distribution is necessary unless the court decides that dividing the property up equally would not be equitable. Courts use a factor test when deciding whether or not to divide the property up equally.Our Charlotte Divorce Attorneys Can Help
If you are facing a divorce in Charlotte, North Carolina, you need a skilled legal team on your side. At Arnold & Smith, PLLC we fight hard for our clients’ right to keep as much of their property as possible. Speak with our detail-oriented and well-versed lawyers in or around Charlotte, Lake Norman, or at our office in Monroe, please contact Arnold & Smith, PLLC today at 704.370.2828.