In the state of Pennsylvania, lawmakers have decided that property division during a divorce is more complex than the simple 50/50 formula that other states follow. Pennsylvania is an equitable distribution state which means that many factors are taken into account before dividing marital assets.
For couples who own a business, how, or if, the business is divided, comes down to whether it’s categorized as marital or separate property.
Separate property|Separate property belongs to one spouse only. Property is deemed separate when acquired before the marriage, after the separation or was excluded from the marital estate through a pre- or postnuptial agreement.
Despite being separate, any increases to the value of the business during the marriage may fall into the equitable distribution process.
Marital property| Marital property is any propertyacquired during a marriage in Pennsylvania. As mentioned above, this can include money earned on separate property or businesses.
For a business owner who is facing divorce, it’s crucial to work with a team of legal experts who can ensure equitable division of assets and debts. Here are some of the most common factors used in the division of a marital estate.
Common factors in property division
- Income and liabilities of each spouse
- Obligation for spousal support in a previous marriage
- Duration of the marriage
- Age and health of each spouse
- Expected pensions and retirement benefits
- Each spouse’s ability to provide for his or herself
- Tax consequences of dividing property
- Any other factor a court may consider to be proper
If you are like half of all couples who must face the reality of divorce, it’s important that you appreciate the value of working with someone experienced in the intricacies of equitable distribution in the state of Pennsylvania.
Great family law attorneys could recite the law nearly verbatim and are able to find creative ways to help couples move forward with their new lives.