Marital property will need to be divided in the event of a divorce or a spouse’s passing. Even if a couple has a prenuptial agreement, it can be challenging to determine who should get what after a separation or a death.
A division lawyer could help untangle marital assets and devise an equitable property division. Our seasoned family attorneys understand the complexities of dividing assets at the end of a marriage. Schedule an initial consultation with Nguyen Roche today to learn more.
The division of assets is often one of the most complex and contentious aspects of a divorce. Central to this process is the classification of assets as either “marital” or “non-marital” (often referred to as separate property). Understanding how these distinctions are made—and how the lines between them can blur—is essential for anyone navigating the end of a marriage.
As a general rule, marital property includes all assets and debts acquired by either spouse during the course of the marriage, regardless of how the asset is titled. In many jurisdictions, the law looks past the name on a deed or a bank account to determine when and how the property was obtained. If the wealth was built during the union, it is typically considered a product of the “marital partnership.”
Common examples of marital property include:
Non-marital property consists of assets that belong to only one spouse and are generally not subject to division during a divorce. While specific laws vary by state—for instance, Maryland specifically uses the term “non-marital property”—the core principles remain similar across many legal landscapes.
Typically, non-marital property includes:
While the definitions above seem straightforward, the reality of long-term marriages often makes these distinctions difficult to maintain. Over time, many couples “commingle” their assets. Commingling occurs when non-marital property is mixed with marital property to the point where they can no longer be easily separated.
A common example of commingling is when a spouse receives an inheritance (non-marital) and deposits it into a joint savings account used for household expenses (marital). Once those funds are used to pay the mortgage or buy groceries, the inheritance may lose its “separate” status.
Transmutation is a related concept where the very nature of the property changes. For example, if a spouse owns a house before marriage but the couple uses marital income to pay down the mortgage and perform significant renovations, a court may rule that the house has “transmuted” into marital property, or at least that the marital estate is entitled to a portion of its value.
Because the stakes are high and the paper trails can be decades long, identifying the nature of assets often requires professional intervention. A property division lawyer may need to collaborate with a forensic accountant or a valuation specialist to “trace” the origin of specific funds.
Tracing involves a meticulous review of bank statements, tax returns, and investment records to prove that a specific asset was purchased with non-marital funds or remained separate throughout the marriage. In complex cases involving business ownership, stock options, or diverse investment portfolios, these experts are vital in ensuring a fair and equitable distribution of weal
Maryland is an equitable distribution state, meaning there is no presumption that the court will divide assets equally. Instead, the court aims for a fair distribution. In addition to the total value of the assets, the following are considered:
Additionally, while Maryland does not require fault to issue a divorce, it can investigate the circumstances that led to it. The law is expansive, allowing the court to consider any factor it needs to in order to make a fair distribution of assets.
In addition to assets, the court must divide liabilities or debts. When deciding how to divide a debt, the court will examine why the debt was acquired, what it was for, and who is in a better position to pay it.
A court may equally divide a debt that the couple used for home improvement. In contrast, if one partner acquired debt to pay for an affair, a judge is unlikely to saddle their partner with it.
In many marriages, the spouses may have substantial disagreements about appropriate spending and saving, and a judge may consider spending patterns when dividing property. An Owings Mills lawyer could answer any additional questions their client has concerning the legal process of property division.
Maryland is not a community property state; rather, it follows equitable distribution laws. In community property states, assets are typically split fifty-fifty. In Maryland, the court focuses on what is fair based on specific circumstances. While a judge might choose an equal split, they have broad discretion to distribute marital assets in a way that truly reflects fairness and justice.
Marital property includes almost all assets acquired by either spouse during the marriage, regardless of whose name is on the legal title. Common examples include houses, cars, bank accounts, furniture, and retirement funds earned during the union. The key factor is the timing of the acquisition. If obtained between the wedding date and the final divorce, it is considered marital.
Non-marital property consists of assets acquired before the marriage began or those received as an inheritance or individual gift from a third party. Assets excluded by a valid prenuptial or postnuptial agreement also fall into this category. To remain non-marital, these assets must usually be kept separate and not commingled with joint family funds or titled in both spouses’ names.
Equitable distribution means the court divides marital property in a manner that is fair, though not necessarily equal. Judges review various legal factors to determine a just split rather than applying a strict fifty-fifty rule. This system allows for flexibility, ensuring that the unique financial circumstances and contributions of each spouse are weighed carefully before any final property award is finalized.
Courts consider the marriage duration, each spouse’s age, and their physical or mental health. They evaluate monetary and non-monetary contributions to family well-being, including housework and childcare. Judges also examine the economic circumstances of both parties, the reasons for the marriage’s breakdown, and any alimony awarded. These diverse factors help the court arrive at an appropriate and fair financial settlement.
If a couple cannot agree on the family home, the court determines its value as marital property. A judge may order the property sold and the proceeds divided equitably between the spouses. Alternatively, one spouse might buy out the other’s interest. If there are minor children, the court may prioritize stability by delaying the sale through a specific court order.
The court can award “use and possession” of the family home and certain personal property to the custodial parent for up to three years. This allows children to remain in a stable, familiar environment. The judge considers the child’s best interests and the financial hardship on the non-possessory parent. During this period, the court may also allocate the mortgage payments.
Retirement assets earned during the marriage are marital property. Dividing these often requires a Qualified Domestic Relations Order (QDRO) to ensure funds are transferred without immediate tax penalties. The court calculates the portion of the account attributed to the years of marriage. Only the value increased during the union is subject to division, while pre-marital contributions generally remain with the owner.
Property owned before the marriage is non-marital, but it can become partially marital through “commingling” or “active appreciation.” If marital funds were used to pay a pre-marital mortgage, or if a spouse’s efforts significantly increased an asset’s value, the other spouse may gain a legal interest. Tracing the original non-marital source is essential to protecting these separate property rights.
Generally, an inheritance received by one spouse is considered separate, non-marital property. This remains true even if the inheritance is received during the marriage. However, if the inherited funds are deposited into a joint bank account or used to purchase a marital asset, they may become marital property. Keeping inheritances in a separate account is vital for maintaining their non-marital status.
A business started or grown during the marriage is typically marital property. Determining its value requires a professional appraisal to assess assets, debts, and “goodwill.” Since Maryland courts cannot usually transfer business ownership, they may award the non-owning spouse a monetary payment to compensate for their share. This ensures an equitable outcome without forcing a disruptive change in business management.
In Maryland, a “monetary award” is a sum of money one spouse is ordered to pay the other to balance the distribution of marital property. Because the court cannot transfer the title of most property from one spouse to the other, this payment adjusts the equities. It ensures that both parties receive a fair total value from the marital estate upon dissolution.
Even when separating spouses are amicable, getting a legal professional’s help with property division is a good idea. Accounting can be complex, especially if people have substantial assets.
Spouses must consider the present and future value of property, such as retirement accounts and pensions. In addition, a property division lawyer could ensure no hidden assets. Schedule an initial consultation with the Nguyen Roche team today to speak with a determined attorney.
Owings Mills
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Owings Mills, MD 21117
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Baltimore
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Baltimore, MD 21202
Maps & Directions
Phone: (443) 238-0160
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