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Equitable distribution of complex assets in New Jersey is a legal process that occurs during a divorce, where the spouses can divide their marital property. Equitable distribution does not necessarily mean a 50/50 split of assets. Instead, it means a fair division based on several factors. It is essential to differentiate between marital property (assets acquired during the marriage) and separate property (assets acquired before the marriage, gifts, or inheritances). Generally, only marital property is subject to equitable distribution.
New Jersey law requires a consideration of several factors. Some of these factors include the following: 1) the duration of the marriage, 2) the age and physical and emotional health of the parties, 3) the income or property brought into the marriage by each party, 4) the standard of living established during the marriage, 5) any written agreement made by the parties before or during the marriage, 6) the economic circumstances of each party, 7) the income and earning capacity of each party, and 8) the contribution of each party to the acquisition, dissipation, preservation, or appreciation in the amount or value of the marital property.
Tips To Navigate Complex Assets
The equitable distribution process involves thoroughly examining the couple’s finances, which can become particularly intricate when dealing with complex assets. Complex assets in equitable distribution can include the following:
- Business Interests: Valuing and dividing a business owned by one or both spouses is often complicated. It requires understanding the business’s worth, structure, and future income potential.
- Real Estate Holdings: Besides the marital home, real estate holdings might include vacation properties, rental properties, or real estate investments, each with its valuation challenges.
- Stock Options and Retirement Accounts: Determining the value of stock options, pensions, 401(k)s, IRAs, and other retirement accounts can be complex, especially when considering potential future values and tax implications.
- Intellectual Property: This can include patents, copyrights, trademarks, or any other type of intellectual property. Valuing these assets can be difficult, mainly if their future income potential is still being determined.
- Art and Collectibles: Appraising high-value items such as art, antiques, and collectibles is necessary.
- Debts and Liabilities: Equitable distribution also involves dividing debts and liabilities, which can be complex if tied to assets, or their division impacts credit scores.
- Tax Implications: Fair distribution of assets must factor in the tax consequences of the distribution.
Many couples negotiate an equitable distribution through their attorneys or mediation, which can be less adversarial and more cost-effective than going to court. If the parties cannot agree, the court will decide on the distribution. The parties will engage in a discovery process where each spouse discloses their assets and debts. Keep in mind that New Jersey is a no-fault divorce state, meaning that the reasons for the divorce typically do not affect the distribution of assets unless the actions of one party have significantly affected the financial state of the marriage (for example, a spouse dissipating marital assets).
Conclusion
Due to the complexities involved in equitable distribution, individuals going through a divorce with various complex assets typically require the assistance of legal professionals, financial advisors, and appraisers to ensure a fair and accurate division of these assets. A family law attorney can provide guidance specific to your situation and help protect your interests. Bozanian McGregor, LLC has experienced and skilled attorneys with over 50 years of combined family law experience, ready to help you tackle the equitable distribution of your property if you are in the midst of a divorce. Contact our firm for an initial consultation.