Almost all divorce cases involve making a decision regarding the division of property and assets. In some cases, spouses are able to come down to a mutual agreement and no disputes arise. In others, the case is taken all the way to the court — sometimes even beyond, to the appellate system.
Regardless of how complicated or simple your property division issue may be, it is imperative that you seek the legal assistance of a reliable and experienced property division attorney. You cannot usually expect the other side to be open and honest during divorce, and there are significant opportunities and risks you might not foresee without dedicated counsel.
We can help ensure that your financial interests are protected. At the Law Office of Fedor Kozlov, P.C., our property division attorneys have helped many clients get fair property settlements in divorce and achieve the best possible positions for their post-divorce life.
Who Decides About Property Division
Many couples start with mediation or other forms of alternative dispute resolution to decide on the details of property division. However, sometimes this is not an option, and other times efforts simply do not bear fruit. When spouses are unable to find common ground as to how they should divide property during divorce, the settlement is decided through court proceedings according to Illinois State Law.
It bears mentioning that most settlement negotiations are informed by what a judge would do, should the case go to court. Additionally, judges have to approve most aspects of division agreements, even if they do not result from a formal trial.
Types of Property in Divorce
One of the essential first steps in divorce property division is setting every asset into the correct category. Miscategorization leads to confusion, dispute, and the possibility of an unfair agreement. Proper organization of all assets and holdings, on the other hand, should promote a clear, equitable division.
This process revolves around determining ownership on a granular, legal level. In legal terms, there are three different types of property divided during a divorce proceeding:
- Separate Property: This includes property that individual partners have acquired before their marriage or through inheritance or gift after marriage. Separate property also includes assets purchased with separate funds during the marriage. This type of property is not divided during a divorce.
- Community Property: This includes property and debt acquired through the efforts of each spouse during their marriage. It could, for example, include earnings put in a joint account or any property bought using money from that account. Community property is generally divided equally between the spouses during divorce.
- Commingled Property: This refers to the property that is a combination of separate and community property. An example of a commingled property is a pension plan from employment that occurred both before and during the marriage.
Of course, property is often challenging to categorize in the real world. Do you own a portion of a vacation house your spouse owned before marriage if you remodeled it using funds from a shared bank account? Do unvested stock options qualify for asset division? How would you categorize heirloom jewelry that your mother left you but that you informally gave to your wife? Is it better to sell stocks or transfer ownership? These are the types of questions that require an experienced divorce attorney to address correctly.
How the Court Divides Property
In most divorce cases, the court divides property using the equitable distribution approach. Equitable doesn’t necessarily mean equal division; it refers to “fair” distribution. There are several factors on which the court decides what is equitable in each divorce case. They include:
- The source of certain assets: Special cases, such as inheritances or personal injury settlements, could influence the amount to which each spouse is entitled.
- Marriage length: Couples with longer marriages tend to have more intertwined finances and interdependent support structures.
- The mental and physical health of each partner: Whether these factors could indicate a need for a more substantial portion of the estate relative to the other spouse.
- Tax considerations: How division could diminish or increase each spouse’s tax individual burden.
- The job prospects and work history of each spouse: The court considers how easy it would be for each spouse to maintain quality of life while training to reenter the job market, for example.
- The type and liquidity of assets: Some assets are non-fungible or have other types of division challenges that the court must address.
As is the case with many aspects of divorce, the court typically has the power to consider almost anything it deems relevant when deciding about how to divide property. This can lead to complex decisions that are difficult for people outside the legal profession to predict with any degree of reliability.
How Can Our Attorneys Help?
At the Law Office of Fedor Kozlov, P.C., our property division attorneys are compassionate and work with you to safeguard your rights. We have a deep understanding of the law and extensive experience arguing cases. We carefully assess every detail of your property division settlement and help you resolve disputes in many focus areas. The following are some examples, but please feel free to contact our office directly if you do not see your issue listed here.
Uncovering Hidden Assets
If you believe your spouse might be hiding something from you (or might be tempted to do so after learning of your intention to divorce), we would urge you to contact us as soon as possible. This is especially true if you do not handle the finances in your marriage. You will need an experienced asset division attorney to assist your investigations and pursue what you truly deserve.
Business Ownership
Business ownership is a complex area of property division. In general, the court usually finds that both spouses contribute to a business, even if only one spouse is engaged in the day-to-day management. For example, most sole proprietorships started during your marriage would be part of the marital estate. However, there are many other things to consider:
- The role and interest level of each spouse in owning or managing the company
- Whether both spouses want to be involved in the business after divorce
- The ownership structure of the company (trust, LLC, corporation, and so forth)
- The management of and source of any start-up or operating capital
- Executive compensation plans and other business assets
Debt Obligations
Debt is all too often one of the causes of an irretrievable breakdown of relations during a marriage. Unfortunately, it is also one of the strongest points of contention in many asset division negotiations. Like assets, debts must be divided in a fair and equitable manner. Our attorneys can help you not shoulder too much of this burden.
Retirement Accounts
Retirement accounts, such as Roth IRAs and 401(k) plans, might be subject to division. However, there could be several types of complications involved with this. Examples include the division of the retirement assets into premarital and marital stages for accurate disbursement, choosing the correct rollover strategies, and handling complex retirement plans (SERPs, for example) typical of high-level incentive packages.
Pension Benefits
Pensions are not as common as they once were. However, divorce attorneys must still be familiar with these types of retirement benefits.
There are several unique considerations that go along with these types of assets. If you or your spouse is a government employee, military servicemember, or any other type of pensioned employee, please prepare accordingly.
Real Estate
Real estate is a challenge during asset division for two main reasons. First is the nature of these assets: No two parcels of real estate are exactly alike. The second issue is that there are many unique types of regulations that govern this particular type of asset. Our office handles all types of real estate division:
- Family homes (primary residence)
- Inherited property
- Commercial and residential investment property
- Vacation homes
Stocks and Other Investments
Securities and their derivatives are notoriously difficult to divide during a divorce. These assets are relatively volatile and are often held with the expectation of return over a specific period of time. This type of forward-looking strategy is in direct conflict with the necessity to provide an accurate valuation within the time limits established by divorce courts.
Do not let market conditions dictate your future just because your divorce is poorly timed for stock division. Contact one of our asset division lawyers to start making sense of it all and truly understand all of your options.
Other Complex Holdings
If you are going through a divorce and want to ensure fair property division, you should talk to an experienced property division attorney. Contact the Law Office of Fedor Kozlov, P.C., today at (847) 241-1299 to schedule a consultation with one of our experienced attorneys to evaluate your legal options.