15 years experience

Is New York a Community Property State?

In states that use the community property system for dividing a couple’s shared assets (California, for example), spouses must divide all their communal property evenly.

New York is not a community property state, though. Instead, state law requires couples to divide their assets “equitably,” which does not always mean a 50/50 split. The goal of this approach is to fairly divide a couple’s assets according to each spouse’s individual needs and contribution to the marriage. This can lead to more conflicts among divorcing spouses, as they often disagree over what is “fair” which often leads to litigation—and a Court deciding how to divide the assets and award support.

Notably, marital property includes marital debt. Like property, debt can be accrued by parties to a marriage and can be considered marital, separate, or a bit of each. When determining marital assets division, we also determine how to divide marital debt and how to determine any separate debt.

Factors New York Courts consider when dividing Marital Assets.

New York law says judges can consider any factor they deem “just and proper” when deciding how a couple will split their shared property (note: this gives judge’s a lot of power and you very little! This is one of the many reasons we will always recommend negotiation to settlement in lieu of litigation, where possible). That provision gives judges significant leeway in these matters, but there are also specific factors the law says judges must examine, including:

  • Each spouse’s income and individual assets
  • The length of the marriage
  • Each spouse’s age and health, along with how those factors may affect a spouse’s earning potential
  • Whether a parent with custody of a child from the marriage needs to keep the marital home and its contents
  • Whether one spouse will lose their health insurance coverage due to the divorce
  • Any spousal maintenance (alimony) payments ordered as part of the divorce
  • Any contributions by one spouse to the other’s individual property (for example, by caring for children, so the other spouse can advance their career)
  • The likely financial circumstances of both spouses after the divorce
  • The difficulty in determining the value of a shared asset, such as a business, and the plausibility of removing one spouse’s interest from the shared asset
  • The potential tax consequences for each spouse depending on what assets they receive.
  • Whether either or both spouses wasted any shared assets
  • Any attempts by either spouse to hide or sell assets at a reduced price because either spouse knew a divorce was imminent
  • Any history of domestic violence in the family

Shared Property vs. Separate Property

You don’t have to divide your separate property when you get divorced. Separate property refers to any assets you received before the marriage and kept separate from the property you shared with your spouse. For example, if you had an individual bank account before getting married and never gave your spouse access or mixed their money with yours, that account might qualify as separate property.

Separate property can also refer to assets you received or inherited from someone other than your spouse, such as a parent or other relative. However, if you received an inheritance and put the money into an account you shared with your spouse, that money would likely qualify as shared property. (in legalese this is called “comingling”)

Some examples of separate property you may be able to keep after a divorce include:

  • Compensation from a personal injury claim (if funds were kept separate from spouse)
  • value of your separate property used to acquire a marital asset or to account for the increased value of an asset
  • Property listed as separate in a prenuptial agreement

Determining separate property can be difficult. It is crucial to have a knowledgeable attorney to help you determine what assets belong to who under the law so that you can get your equitable fair share of the marital estate.

How Prenuptial Agreements affect Property Division in a Divorce

A prenuptial agreement can simplify the process of dividing assets in a divorce, provided the agreement complies with state law. The requirements for a valid prenuptial agreement include:

  • Both spouses must review the agreement with their individual attorneys before signing it.
  • Both parties must disclose their financial assets and debts before signing the agreement. Furthermore, the disclosure must be accurate, as any fraudulent disclosures are cause to invalidate a prenup.
  • Neither spouse can sign the agreement under coercion or threats.
  • The agreement cannot be so one-sided that it leaves one spouse with little or no assets after a divorce.

We at the Law Offices of Alexandria Lipton are happy to assist in the drafting and proper execution of a prenuptial agreement or a postnuptial agreement. Some provisions a valid prenup can include are:

  • Addressing how spouses will handle any debts from before the marriage.
  • Defining spousal maintenance payments (alimony, spousal support) in the event of divorce.
  • Establishing child support guidelines, as long as those guidelines comply with state law.
  • Defining marital vs. separate property in the event of divorce.

What if your Spouse tries to hide Shared Assets?

You can’t get a fair share of your marital assets if your spouse doesn’t fully disclose those assets. The Law Offices of Alexandria Lipton has the tools and resources to help you find any monies your spouse tries to hide or lie about. Moreover, if you can prove your spouse tried to hide assets during your divorce, you could claim a greater portion of your shared property. Our firm, and all of its’ attorneys are prepared to help you get all that you are entitled to.