When a marriage is ending, couples generally try to come to an agreement about the terms of the settlement. They need to decide how to split up the property and assets as well as the debts that they accumulated during the marriage. Wisconsin is a community property state. This means that assets acquired while you are married are to be divided equally between spouses when the marriage ends.
What Does Marital Property Include?
Marital property is also called community property. It includes property and assets that the spouses purchased with marital funds. Wisconsin Statute Chapter 766 defines and governs marital property. The presumption is that everything that the couple buys when they are married is jointly owned property. Marital property includes property and assets such as your home, vehicles, furniture, electronics, appliances, art, stocks, bank accounts, and more. It also includes the money you earn during the marriage. There are several exceptions to what may be considered marital property.
Exceptions to Marital Property
There are several important exceptions to the marital property distribution laws. There are some items that are separate property and therefore are not part of equal distribution in a divorce settlement. These exceptions are:
- Property owned prior to marriage
- Inheritance
- Gifts
Property that you owned prior to the wedding date is your personal property and is separate from marital property. For example, if you purchased a car before you got married, it is yours to keep and is not included in community property for purposes of distribution. If one person received an inheritance during the marriage, those funds are not part of community property. The same holds true for gifts that each person received alone.
If the couple has a prenuptial agreement in place, it will impact the distribution of assets accordingly. There may be some instances in which separate property can become marital property. One example of this is when one spouse purchased a home before the marriage but the other spouse contributed significantly to it after the wedding. If the other spouse made payments toward the home and worked to improve and care for the house, it may be considered marital property now. It is helpful to seek legal guidance to determine the marital property in your case. Every situation is different and you need to make sure that the property will be properly accounted for and distributed.
Retirement Accounts
Retirement accounts are often a source of dispute among spouses when they divorce. Generally, retirement accounts are part of community property and therefore, both parties have an equal right to them. However, when the person contributed to the account before they got married, the distribution can be more challenging. In these situations, the property is considered hybrid because it is partly separate and partly marital. A formula will be used to calculate the portion of these types of assets that will be part of marital property. When the divorce is final, the court will provide a qualified domestic relations order (QDRO) for legal distribution of the assets once the time comes.
Although marital property rules can seem simple, they are actually quite complex. A long marriage or one in which the couple owns a large number of assets can be even more complicated. If you are going through a divorce, you will want to make sure that you protect your rights and receive an equal portion of the marital assets. Contact our compassionate legal team at Moen Sheehan Meyer, Ltd. by phone at (608) 784-8310 or by email for a case consultation.