Joanne Kleiner & Associates

property division

Nov 24

Marital Property Laws That You Should Be Aware Of

What You Should Know About Division of Property When Divorcing

When you’re about to file for a divorce, one factor that you’ll need to take into account is how the property is going to be divided. The divorce rate for Pennsylvania in 2016 was at 2.6 divorces for every 1,000 people, which is a number that has remained consistent over the past decade. If you are looking to file for a divorce and would like some advice on what the process is like, call our family lawyers today to get started.

What Constitutes Marital Property?

Marital property in the state of Pennsylvania refers to any asset that was acquired during the marriage by either party. Any item that was acquired between the first day of your marriage and the first day of your separation would be considered marital property. Non-marital property includes:

  • Items that were acquired before the marriage by either spouse
  • Assets that were acquired by inheritance or gift at any point before or during the marriage, which does not include gifts that were provided to one spouse from the other
  • Assets that were acquired following the separation

Even though these are the general guidelines that determine what constitutes marital property, the court typically has the final say.

How Marital Property Is Divided During a Divorce

Married couples who are divorcing have the option to create an agreement on how they would best like to divide their property, which is referred to as a property settlement agreement. This agreement is then provided to the court, after which a judge will place the agreement into their final decision on the divorce. Although the court takes these agreements into consideration, they aren’t always ironclad. Couples who are unable to agree on how to divide their marital property may have their case taken to the court.

One of the largest components that determine how property is divided is the value of the property and assets. The married couple will need to identify how much these assets are worth before going forward with an agreement. The worth of an asset is directly impacted by a variety of factors, the primary of which is the current and fair market value of the item. The fair market value refers to how much money that you could receive at the current time when selling one of these assets, which can include vehicles and homes.

Court Considerations for Marital Property During a Divorce

Unless you have a prenuptial agreement in place prior to the marriage that identifies how marital property will be divided, the court will take a wide range of considerations into account when determining how to divide the property. The term used by the courts is equitable distribution, which means that the division of the property will be fair to both parties. Some of the main factors that are considered by the courts include:

  • How long the marriage lasted
  • The vocational skills each spouse has and their ability to obtain employment
  • The education, sources of income, age, and health of each spouse
  • Whether or not each spouse has been previously married
  • The number of assets, needs, and debts that each spouse has

These are just a small number of the various considerations that might be taken into account by the courts. Everything from the reduction in value of marital assets to the standard of living that each spouse expects will also be taken into account. One factor that isn’t considered by the courts in Pennsylvania is marital misconduct. However, if the misconduct caused major financial issues with the value of any marital property, it may be taken into consideration. If you have any questions about how the courts divide marital property, our family lawyers are here to answer them.

If you’re seeking a divorce and you would like some assistance with the finer details of your case, call one of our family lawyers today at our practice in Jenkintown at (215) 886-1266.

Jun 20

How Does Equitable Distribution Work in Pennsylvania?

Equitable Distribution

In Pennsylvania, in a divorce proceeding, the principle of equitable distribution applies to the allocation of all debts and assets accumulated during the marriage. You and your spouse may amicably work out a property settlement, but the court will still have the authority to review that agreement and revise or reject it if there is any perception of duress, undue influence or misrepresentation.

The first thing to understand about equitable distribution is that the word “equitable” means “fair,” not equal. As a practical matter, dividing the debts and assets equally may be the fair way to settle the marital estate, but the court has latitude to deviate from that approach, based on a number of factors, including:

  • How long the parties were married
  • Whether or not either party was previously married
  • The age, health, station in life, sources of income, employability, vocational skills and other needs of each party
  • Any contribution either party made to the other’s education, training or increased earning power
  • Value of any property set apart to each party
  • The standard of living to which the parties were accustomed during marriage
  • The involvement of both parties in building or dissipating marital assets

Whether one of the parties will have physical custody of minor children

It’s also important to know that Pennsylvania characterizes property as either marital property or separate property. Separate property is generally property brought into the marriage by a party, acquired by gift or inheritance, excluded in a valid prenuptial agreement, or acquired after separation. For purposes of equitable distribution, separate property is excluded.

Contact Attorney Joanne E. Kleiner

Let us help you protect your rights. Contact our office online or call us at 215-886-1266 to schedule a confidential consultation. We will help you stay focused on the issues that matter.

Jun 15

Avoiding the Common Mistakes When Dividing Finances after a Divorce

Division of Property

In the aftermath of a marital breakup, determining how assets and debts will be allocated can be the most challenging task. Without competent legal guidance, there are a number of common miscues that many people make.

Failing to Look at the Tax Consequences of Dividing Property

On the surface, it may appear that you and your ex came out about even, but what about the potential tax ramifications? If one party gets to keep the house and the other party gets retirement plan assets, there can be a significant difference in the value when you actually see the money. Because most retirement plan assets are pre-tax contributions, there will typically be tax consequences upon the withdrawal of funds. However, with the sale of a house, provided the capital gains fall under the allowable amount, there may be no tax event.

Keeping Some Accounts in Common with Your Ex

There’s no good reason to keep any joint accounts with your ex. You’ll want to close all joint bank accounts, credit cards, and investment accounts, as well as any debts/loans, including your mortgage. Don’t forget to change the beneficiary on life insurance policies, annuities, retirement accounts and investment portfolios, unless you want the proceeds to go to your ex in the event of your death.

Making Financial Decisions Based on Emotional Attachments

In general, property is just property and can be replaced. The minute you start attaching emotional value to items of personal or real property, you put yourself in a position to be exploited.

Failing to Take the Time to Identify and Locate All Debts and Assets

A recent study found that nearly 20% of recently divorced people admitted to hiding a bank account or other asset from a spouse. Don’t let your desire to be done with the process let you get the short end of the stick.

Contact Us

At the office of Joanne E. Kleiner & Associates, we have more than 25 years of family law experience. We’ll help you stay focused on what matters. To schedule an appointment with an experienced Pennsylvania divorce attorney, contact our office online or call us at 215-886-1266.

Mar 15

Take Care if You Are Involved in a Divorce Just Before or After Retirement

Crossword with IRA 401K

According to statistics, the rate of divorce among older Americans has more than doubled in the last 20 years. Even though these proceedings seldom involve disputes over child custody, visitation and child support, there can be other factors that make elder divorce proceedings complicated and time-consuming, such as the increased size of the marital estates and the allocation of retirement assets.

It’s Mostly in the Details

A primary concern in elder divorce cases involves the marital home. There may be substantial equity in the property, money that may be a key component of your retirement planning. When you divorce, one option may be to sell the home and split the proceeds. There are, however, potentially adverse tax consequences to this approach. Take the time to discuss the matter with your tax adviser and your lawyer before you do anything.

Whether you have already retired and have substantial retirement plan assets and are at or near the end of your working life, you need to be extremely careful how you divide retirement or pension plan assets. If you have an IRA, you can usually split the value and transfer a portion of the funds over into a new IRA without any adverse tax consequences. However, if you have a 401(k), 403(b), or other qualified plan, you’ll want a Qualified Domestic Relations Order (QDRO) or you will likely have a tax consequence on the transfer.

It’s also important to review your life insurance coverage as part of a late-in-life divorce. If you own the policy, you will need to designate a new beneficiary.

Contact Us

At the office of Joanne E. Kleiner & Associates, we have more than 25 years of family law experience. We’ll help you stay focused on what matters. To schedule an appointment with an experienced Pennsylvania divorce attorney, contact our office online or call us at 215-886-1266.

Dec 15

Divorce and Selling Your Home in Pennsylvania

Selling the Marital Home in a Pennsylvania Divorced

Snow covered homeWhen it comes to dividing marital assets in a divorce, one of the most difficult items to allocate is the marital home. It’s customarily the single largest marital asset and cannot be meaningful divided between the parties. You may agree to have one party remain in the house and offset the value of the real estate by giving the other party a greater share of the remaining assets. The most common way to resolve the issue, though, is to sell the marital home. Here are some things to consider.

The Costs of Selling the Home

Ideally, you’ll be able to sell the house for more than the amount owed, so you should have some type of profit. However, there will also be costs associated with the sale of the home, including an agent/broker fee, closing costs, appraisal fees and the costs of a survey. You may be able to get the buyer to assume some of those costs, or you can have those costs taken from the proceeds of the sale.

Don’t Try to Sell the Home on Your Own

If you have some business savvy, this can often be a good idea—but not when you are in the middle of a divorce. You won’t be able to focus appropriate attention on all the details and you may end up selling for less that the property is worth. In addition, an agent will help you determine the best price at which to sell, so you don’t have to bicker about the asking price. Another advantage of an agent—they may be willing to “stage” the house, so you don’t have to determine who will prepare the house for sale.

Agree How Proceeds Will Be Divided before You Sell

This is something that should be worked out by your divorce attorney. Make certain before you sell that you know exactly how any net proceeds will be allocated. Be sure to include reimbursement of costs or additional payments.

Contact Attorney Joanne E. Kleiner

Let us help you protect your rights. Send us an email or call us at 215-886-1266 to schedule a confidential consultation. We will help you stay focused on the issues that matter.