First off, we have to determine what is a marital asset. You have to look at any separate property that you might have. What is separate property? Separate property includes property that you own prior to the marriage. It also includes property that you obtained by gift or inheritance. Do you have any separate property? For example, if you are working in a job and had a 401(k) or an IRA account prior to the marriage, the basis of that account is your separate property that’s not subject to division. What is subject to division is any increase in that asset during the marriage. You need to get the account statements from the date of marriage and make sure you have those if you think divorce is looming on the horizon. Otherwise, marital property is divided based upon how much a party has contributed towards the acquisition of that asset.
We also look at the length of the marriage and the role that each party has during the marriage. Essentially then what we do is we take the asset. We look if there is any separate property component and divide that out. We look in at whether or not that asset isn’t [covered 01:21] by the sort of loan against it, mortgage or a car loan. Then we take those assets and we put them on a spreadsheet and then we also look at liability. We look at unsecured debt, credit card debt. The goal is to get everything gelled down into basically an Excel spreadsheet and then we look at who owns that asset. For example, if you have a house, a couple of cars and a couple of credit cards, it doesn’t make sense to have one party responsible for paying a credit card debt as in the other party’s name. That’s just going to be a disaster. Maybe we want to offset that debt in some other manner.
We also look at, for example, if each party has a car and has a car loan. It makes sense that that party will take the car and the car loan. If we have a house, we have to decide if somebody going to want to keep that house. If they are wanting to keep that house, is the other party obligated on the loan. The court is not going to allow you to keep that asset and have the other party stay on the loan for an extended period of time. If you want to keep the house, then you’re going to have to make arrangements to refinance that loan and remove the other party from liability on that loan. That is a big stumbling block for a lot of people. If you’re not able to do that, then that property is going to be
ordered to be sold and the proceeds will be divided accordingly.
Other factors to keep in mind are retirement accounts. If you do need to divide up a retirement account and it’s a 401(k) type of account, then you’re going to need to get a qualified domestic relations order prepared to make sure that the division of that account does not cause any tax problems with IRS. There are a lot of moving parts involve to dividing property and marital property in Colorado and it is important that you go and get legal advice. Come in and see me, we’ll talk about the most sensible way
to accomplish that.
Contact us for more information.