Divorce and Family Law Office of Joanne Kleiner

Divorce Lawyer Joanne Kleiner

marital asset

Jan 25

Who Gets the Family Jewels in a Divorce?

Distributing Family Jewelry as Part of a Divorce Settlement

During a divorce, the division of valuable assets is often contentious.

Jewelry Is Often a Sore Spot in Asset Division

Jewelry, including family heirlooms, is often a hot spot in the divorce settlement process. Our Jenkintown family lawyer offers representation for people who are in the process of a divorce and for whom the division of jewelry could be a matter of disagreement. In some cases, each piece of jewelry that entered the marriage could be a sore spot for arguments.

Symbols of the Marriage

Wedding bands and engagement rings are seen as symbols of marriage. In many cases, these items also have a considerable monetary value. In New Jersey, gifts received before marriage aren’t considered to be marital assets. Since an engagement ring is given as a gift before marriage, it wouldn’t be subject to asset division in a divorce. In states with community property laws, jewelry exchanged during marriage is subject to a 50/50 split of the value.

Valuable Family Heirlooms

In many families, pieces of jewelry are received as gifts or as part of an estate. For example, a woman may be given a pair of valuable pearl earrings in her husband’s grandmother’s estate. This is a marital asset, and a judge could order the property split between the two parties in the divorce. Splitting a pair of earrings is impractical, so a judge might award one party the earrings and another party a different item of an equal monetary value.

Special Situations

Special situations may arise when it comes to the division of jewelry in a divorce. For example, an engagement ring given before marriage is exempt. If the stone was replaced with a larger stone after marriage, then the setting would still be exempt, but the stone would be a community property asset and eligible for equitable distribution.

Sentimental Family Heirlooms

Even when an item has little monetary value, it could be a matter of contention in a divorce. A piece of costume jewelry may only have a worth of $50, but its sentimental value could be priceless. In a feisty divorce, parties might even argue over costume jewelry pieces. These would still be held subject to community property laws if they were acquired during the marriage.

Appraisal of Jewelry

When assets are split, a judge may order an appraisal of valuable items such as cars, antique furniture, houses, and jewelry. The court may appoint an appraiser or ask each party in the divorce to nominate an appraiser. If one party challenges the appraisal of a piece of jewelry, then a second appraisal at the cost of the challenging party may be permitted. Once the court knows how much the piece or pieces of jewelry are worth, the division of shared assets can proceed. If the couple already has an appraisal for insurance purposes, then the court may accept the existing appraisal if both parties agree.

Appraisals When Calculating Spousal Support

In some divorce cases, one party requests spousal support. When this type of support is requested, the court will order a calculation of each party’s assets. In this case, each person’s separate property will be considered. This means that the engagement ring and wedding bands would be counted in the value of the assets. In this way, the law sees jewelry as an asset that’s no different from any other asset acquired before or during the marriage.

Our Jenkintown family lawyer offers consultations for divorce cases in which the distribution of jewelry could be an issue. Contact the Law Office of Joanne Kleiner by calling (215) 886-1266 or visiting our office in Jenkintown to make an appointment.

Mar 03

How Do You Divide Retirement Benefits After a Divorce?

Who Gets the Retirement Account in a Divorce?

Asset division is one of the most common reasons for disputes during a divorce. If you want to make things a little easier, it’s helpful to understand how retirement accounts are divided during the process.

Are Retirement Accounts Joint or Separate Property?

During a divorce, the main question about any asset is whether it is personal property or marital property. If the retirement account is separate, personal property, then the original owner of it retains control. If the account is a marital asset, it and other types of joint property all have to be split up.

The basic rule for determining what counts as joint property is in part when the property was acquired. Accounts started after marriage are usually marital property. If the account was started before marriage but either spouse contributed money to the retirement account following marriage, a proportionate amount of the account becomes marital property.

A retirement account is usually only personal property if you quit adding funds once you got married. Some types of prenuptial arrangements can also mean that certain retirement accounts remain personal property regardless of whether money is contributed after marriage.

Different Types of Retirement Accounts Are Handled Differently

To figure out how to fairly split retirement accounts in a divorce, you need to pay close attention to the retirement account type. For a traditional IRA or 401(k), it is simple. There are some basic formulas your divorce lawyer can use to quickly estimate how much you contributed and how the property should be divided.

Things get more challenging with defined benefit plans like pensions. These involve an employer providing their employee with a certain amount of money at retirement, and the amount the employee gets is based on how long they work there. Since there is no way of knowing how long a person will continue to be an employee, your lawyer will have to just roughly estimate the value.

Strategies for Dividing Retirement Accounts Fairly

Whenever you are handling retirement accounts in divorce, it is a good idea to be flexible. For many couples, the simplest option is just agreeing that each party keeps all the funds of the retirement account in their name. However, this isn’t always a fair or possible option. Another common choice is offering a cash payment in exchange for complete control of an account. For defined benefit plans, the court along with the plan administrator will require a Qualified Domestic Relations Order. This allows the spouse who doesn’t own the plan to get a certain amount of the plan benefits.

It is also possible to divide the retirement account into two new retirement accounts that each contain a certain proportion of the funds. You could ask to retain control of a retirement account in exchange for other perks. For example, one spouse could take the retirement account while another takes the house. You could even negotiate a lower alimony payment in exchange for a retirement account.

How to Resolve Retirement Account Division Disputes

In an ideal world, you and your ex-partner would be able to quickly and easily find a mutually-satisfactory way to divide up retirement accounts. However, if you and your ex cannot come to a quick agreement on your own, your divorce lawyers can try negotiating. You can send offers and counter-offers to your ex that suggest different asset division strategies.

If this does not work, it might be time to get a neutral party involved. Many people are finding that a mediator can help settle disagreements in a mutually satisfactory way, or you can get a judge to divide the accounts in court. Though there is no guarantee that things will go in your favor, having a judge decide how to divide your retirement accounts can settle arguments once and for all.

Interested in learning more about retirement account division? The Law Office of Joanne Kleiner is here to help Montgomery County residents with their divorces. Call 215-886-1266 or send us a message to arrange a free consultation.