Pennsylvania’s Equitable Division Laws Are Complex
The process of dividing property obtained during the marriage and debts incurred during the marriage is known as equitable distribution. The initial focus is determining whether property that exists at the date of separation is marital, non-marital or a mixture of the two. In general, marital property is any property that is earned or purchased by either of the parties between the date of marriage and the date of separation. It does not matter whether the title of the property is only in one parties’ name or purchased with only money from one parties’ paycheck. If property is marital, it will need to be divided between the parties. If the property is in the form of real estate or personal property, one of the parties often gets to keep the property and the party that keeps the property will pay the other party for a portion of the value of the marital property.
If this is not possible, the parties will often sell the property and split the proceeds of the sale. If the property is in the form of retirement plans or pensions, there are various ways that the property is divided, including lump sum payouts or payments directly to the divorced spouse from the retirement plan company when the spouse receives their monthly benefit. Often, the distribution of monies from a retirement plan will need to be accomplished by a Qualified Domestic Relations Order (otherwise known as a QDRO). The purpose of a QDRO is an Order directed to a company that holds the retirement or pension plan that they need to make certain payments to the spouse that does not have the retirement plan. For military retirement plans, the Order is often called a Qualified Military Domestic Relations Order or QMDRO.
What About Dividing Marital Debt?
Marital debt works the same way. If property or items are purchased with a credit card or a loan is obtained during the marriage, the debt is marital and the responsibility of both of the parties, even if the debt is only in one parties’ name. There are exceptions for debts that are incurred for purposes that are contradictory to the marriage, such as charges for strip clubs or hotel rooms used for adultery.
If the parties are able to work out an agreement as to the division of marital property and debts, the agreement is drafted into a Marital Settlement Agreement that both of the parties sign. Marital Settlement Agreements are legal documents that address who gets what property and what the responsibility of either of the parties are after the divorce is finalized. Marital Settlement Agreements are binding on the parties after the divorce and can be challenged after the divorce is finalized in the event that one of the parties claims that the other party did not fulfill their duties in the Agreement or did not disclose all assets during the divorce process. For this reason, it is always best to have an attorney with Coover & Associates review a Marital Settlement Agreement on your behalf before you sign it.
If the parties are not able to reach an agreement regarding what property is marital or non-marital, how to divide the marital property or which spouse is going to be responsible for the marital debts, then the court has to make the decision on these issues. Each courthouse has a different process in how this is handled, but typically the Divorce Master’s Office will hold a hearing (or sometimes a series of hearings) on what each party is entitled to and responsible for. In deciding on how to divide marital property, the Divorce Master’s Office can consider each spouse’s income, health and ability to make money in the future, along with several other factors, although fault in who caused the end of the marriage is not allowed to be considered. The Divorce Master process is very complex and complicated and it is in your best interest to have an attorney assist you in handling a case with the Divorce Master’s Office. At Coover & Associates, our attorneys are familiar with the Divorce Master process employed by the courthouses in the central Pennsylvania area. We will be glad to assist you with obtaining an order that maximizes the property that you obtain from the divorce.