In Maryland, like most other states, the court distributes all assets and debts acquired during the marriage equitably—not necessarily equally—during the divorce process. In contrast, a handful of states rely on laws that require an equal split of all property. There are pros and cons of each system.
Maryland courts typically accept property settlement agreements reached between divorcing partners out of court, regardless of whether you split the assets 50/50 or based the settlement on other criteria, so long as the split is equitable.
What is equitable distribution?
Equitable simply means “fair.” It is important to remember that fair does not always mean equal, according to Maryland equitable distribution laws.
The courts use a number of factors to divide marital property in a fair manner during the divorce process. Since judges and arbitrators who oversee property division must abide by laws that require a fair split of assets and debts, you may or may not walk away with a share you deem equal to the share your former partner received.
In many cases, equitable distribution does mean that each party receives roughly half of the assets. This is often true if both partners earned equal pay and contributed equally to investments, or if one party worked while the other focused on keeping the home and raising the children.
What if we want to divide our assets 50/50?
If you prefer a 50/50 split of assets, the best option is to negotiate a separation settlement agreement that divides all marital property equally. If you can work with your former partner to do this, the court will likely honor your wishes and include this settlement in your divorce decree. If not, you will have to take the case to court, and the judge may not divide the property equally.
How does property division work in community property states?
In the nine community property states, the law typically mandates an equal split of all marital property. In addition, the court assumes both partners jointly own all property unless there is concrete evidence to prove otherwise. This system does not consider each partner’s contributions to the family, whether financial or otherwise. Instead, it simply assumes both contributed equally and therefore deserve an equal share of the assets.
Community property division, like equitable distribution, requires appraisal or valuation of all assets before splitting them between the spouses. Only then can the court award an equal value of assets to each partner.
Only nine states use community property laws for property division during divorce: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin.
What can I expect during the property division process in Maryland?
Assets in some marriages—especially short partnerships or those without many joint assets or debts—are fairly simple to divide in an equitable manner. However, with marriages that last a decade or more or when the partners have numerous joint investments, retirement accounts, and property, the process is more complicated.
In each case, both parties take their own individual property, but the process to distribute the marital property requires a more complex inquiry into the partnership and each person’s financial health and overall well-being.
Even though Maryland is an equitable distribution state, most judges begin the process with a roughly even split of the assets between the partners. From there, judges must use predetermined factors set by the state’s divorce laws to determine if awarding one party a larger proportion is equitable given the facts of the case.
Once the judge determines a fair split of the marital property, the court divides the individual assets in a way that gives each spouse his or her proportion of the total value of the estate.
In some cases, the judge will order the physical transfer of items or the transfer of a title from one partner to the other.
In others, achieving an equitable split requires ordering one partner to pay the other the value of an asset—also known as a buyout. This happens often with the family home, when one partner continues to live in the house but must pay the other party a portion of the home’s equity.
How can Hecht & Associates help?
Hecht & Associates works to protect our clients’ rights during divorce cases, and to ensure a fair division of property to the full extent of the Maryland and Washington D.C. divorce laws.
If you are facing a divorce and fear your assets are at risk, we will fight to help you negotiate a fair settlement agreement or secure an equitable division of property from the courts. Call us today at 301-587-2099 to learn more.