In North Carolina, the division of property, assets, and debts in a divorce follows the principle of equitable distribution. This process aims to divide marital property in a way that is fair, but not necessarily equal. 

Understanding how this process works and what factors the court considers can help you prepare for what to expect and ensure your rights are protected throughout the divorce.

Marital Property vs. Separate Property

Before any division takes place, it is important to distinguish between marital property and separate property, as only marital property is subject to division during a divorce.

• Marital Property: This includes all assets and debts acquired by either spouse during the marriage, regardless of whose name is on the title or account. Marital property typically includes the family home, joint bank accounts, retirement benefits earned during the marriage, vehicles, and other assets acquired after the marriage date. Even if one spouse was primarily responsible for earning the money used to acquire the property, it is still considered marital property under North Carolina law.
• Separate Property: Separate property includes assets or debts that either spouse acquired before the marriage or received during the marriage as a gift or inheritance specifically to one spouse. Separate property also includes any assets or property specifically outlined as separate in a valid prenuptial agreement. It’s important to note that separate property is not subject to division and remains with the spouse who originally owned it.

In some cases, there may be mixed property, which includes both marital and separate elements. 

For example, if one spouse owned a house before the marriage but the couple made mortgage payments on it during the marriage, the house may have both separate and marital components. 

The court will determine how much of the value of the asset is marital and subject to division.

Factors the Court Considers in Equitable Distribution

North Carolina’s equitable distribution system does not necessarily mean a 50/50 split of marital assets and debts. Instead, the court looks at a variety of factors to determine what is fair for both parties. The goal is to divide property in a way that reflects each spouse’s contributions to the marriage and their financial needs after the divorce.

Here are some of the key factors the court considers when dividing property:

1. Length of the Marriage
   The duration of the marriage can play a significant role in how property is divided. In longer marriages, the court may be more likely to divide property equally because both spouses may have contributed to the acquisition of assets and debts over a long period. In shorter marriages, the division may more closely reflect each spouse’s individual contributions.
2. Each Spouse’s Income, Property, and Financial Status
   The court will consider each spouse’s income, separate property, and overall financial situation. If one spouse has significantly more income or assets than the other, the court may award a larger portion of the marital property to the spouse with fewer resources to ensure financial stability after the divorce.
3. Contributions to the Acquisition of Marital Property
   Both financial and non-financial contributions are considered in equitable distribution. This means that a spouse who worked full-time to support the family and a spouse who stayed home to care for the children are both recognized for their contributions to the marriage. The court will evaluate how each spouse contributed to the acquisition, preservation, and maintenance of the marital property.
4. Custody of Children
   If one spouse is awarded primary physical custody of the children, the court may take this into account when dividing property. For example, the spouse with primary custody may be awarded the family home to provide a stable environment for the children. Additionally, the court may consider the impact of child support or alimony payments on the financial situation of both spouses.
5. Debts and Liabilities
   Marital debts, such as mortgages, credit card debts, and car loans, are divided alongside marital assets. The court will consider each spouse’s ability to repay these debts when determining how they should be divided. In some cases, the court may allocate a larger share of the debts to the spouse who has a higher income or greater financial resources.
6. Acts of Waste or Dissipation
   If one spouse wasted or dissipated marital assets, such as by gambling or spending large sums of money on extramarital affairs, the court may consider this when dividing property. A spouse who engaged in wasteful spending may receive a smaller share of the marital estate to account for the losses caused by their actions.
7. Tax Consequences
   The court may consider the tax implications of dividing certain assets, such as retirement accounts, stocks, or real estate. For example, if one spouse is awarded an asset that will result in significant tax liabilities upon sale or withdrawal, the court may adjust the division of other assets to account for this tax burden.
8. Retirement and Pension Accounts
   Retirement and pension accounts earned during the marriage are considered marital property. However, dividing these assets can be complex, especially if the accounts are employer-sponsored or involve pensions. The court may use a Qualified Domestic Relations Order (QDRO) to ensure that retirement benefits are divided equitably without triggering early withdrawal penalties or tax liabilities.
9. Health and Age of the Spouses
   The court may consider each spouse’s age and health when determining how to divide property. If one spouse is significantly older or has health issues that limit their ability to earn income, the court may award them a larger share of the marital assets to provide for their future financial needs.
10. Alimony or Spousal Support
    If alimony or spousal support is awarded, the court may take this into consideration when dividing property. For example, if one spouse receives a larger share of the marital assets, the court may reduce the amount of alimony that spouse is entitled to receive.

Property Division Process

The property division process generally follows several steps:

1. Inventory of Marital Property and Debts:
   Both spouses must provide a full inventory of their assets and debts, including bank accounts, real estate, vehicles, retirement accounts, and any outstanding loans or liabilities. Accurate documentation is essential for ensuring that property is divided fairly.
2. Classification of Property:
   The court will classify each asset and debt as either marital or separate property. Only marital property is subject to division. This process may involve appraisals, financial statements, and expert testimony, especially if there are disputes over the value or classification of certain assets.
3. Valuation of Assets:
   Once the property has been classified, the court will determine the value of the marital property. This can include appraisals of real estate, businesses, or valuable personal property, as well as statements of account balances for financial assets.
4. Distribution of Property:
   The court will then distribute the marital property and debts based on the principles of equitable distribution. If both parties agree on how to divide their assets and debts, they can present a settlement agreement to the court for approval. If they cannot agree, the court will issue an order determining how the property will be divided.

Alternatives to Court-Ordered Property Division

While the court can decide how to divide property if the spouses cannot agree, many couples prefer to reach a settlement agreement outside of court. This allows both parties to have more control over the outcome and can save time and money by avoiding a lengthy court battle.

With the help of your attorney, you and your spouse can negotiate a property division agreement that reflects your preferences and priorities. Once an agreement is reached, it can be submitted to the court for approval. As long as the agreement is fair and equitable, the court is likely to approve it.

How Devan & Null Can Help You with Property Division

At Devan & Null PLLC, we understand that dividing property during a divorce can be a stressful and emotional process. With over 30 years of experience in family law, Attorney Laura Devan is here to guide you through every step of the equitable distribution process, ensuring that your rights are protected and that you receive your fair share of marital property.

We work with you to:

• Help you identify and classify your assets and debts to ensure a fair and accurate division of property.
• Negotiate on your behalf to reach a settlement agreement that protects your financial interests and avoids unnecessary conflict.
• Advocate for your rights in court if property division disputes arise and ensure that the court understands your financial needs and contributions to the marriage.

If you’re concerned about how your property, assets, and debts will be divided during your divorce, contact Devan & Null PLLC today at 910-486-6855 to schedule a consultation. We help you navigate the complexities of equitable distribution and ensure a fair outcome.

In North Carolina, property division during a divorce follows the principle of equitable distribution, which requires that marital property be divided fairly (though not always equally) between the spouses. 

One of the most critical steps in this process is determining what is classified as marital property and what is considered separate property. This distinction plays a key role in deciding what assets and debts will be divided during the divorce and what remains the sole property of each spouse.

Marital Property vs. Separate Property

Marital Property refers to all assets and debts acquired by either spouse during the marriage, regardless of whose name is on the title or deed. This type of property is subject to equitable distribution in the event of a divorce. Common examples of marital property include:

• The family home or any real estate purchased during the marriage
• Joint bank accounts, savings accounts, and investments accumulated while married
• Retirement benefits, such as pensions, 401(k) plans, or IRAs, that were earned during the marriage
• Vehicles, furniture, and other personal property acquired during the marriage
• Debts incurred during the marriage, such as mortgages, car loans, or credit card debts

In short, marital property is any asset or liability that was acquired during the course of the marriage and belongs to both spouses, regardless of how it is titled.

Separate Property, on the other hand, refers to assets or debts that belong exclusively to one spouse and are not subject to division in a divorce. Separate property typically includes:

• Assets acquired before the marriage: Any property, real estate, or personal belongings that one spouse owned before the marriage remains that spouse’s separate property.
• Gifts or inheritances: Property that one spouse received as a gift or inheritance during the marriage is considered separate property, as long as it was kept separate and not commingled with marital assets.
• Property designated as separate: If both spouses agreed in writing (through a prenuptial or postnuptial agreement) that certain property would remain separate, it will be treated as such.
• Debts incurred before the marriage: Any debts that one spouse brought into the marriage are generally considered separate and remain the responsibility of that spouse.

However, it’s important to note that commingling can affect the classification of separate property. If separate property is mixed with marital property during the marriage, or if marital funds are used to maintain or improve separate property, it may become partially or fully classified as marital property.

How to Determine What Belongs to Each of You

The process of distinguishing between marital and separate property can be straightforward in some cases, but it can also become complex—especially if there are significant assets or if separate property has been commingled with marital property. Here’s how the process typically works:

1. Inventory Your Assets and Debts

The first step in determining what belongs to each spouse is to create a comprehensive inventory of all assets and debts, regardless of whether you believe they are marital or separate. This includes:

• Real estate, including the family home and any rental or vacation properties
• Bank accounts and savings accounts
• Investment portfolios, stocks, and bonds
• Retirement accounts and pensions
• Vehicles, furniture, and other personal property
• Business interests or ownership
• Debts, such as mortgages, loans, and credit card balances

Once you have a complete list of assets and debts, you and your spouse, along with your attorneys, can begin categorizing each item as either marital or separate property.

2. Classify Marital and Separate Property

Next, you’ll work to classify each asset or debt as either marital or separate property. This may involve gathering documentation such as purchase receipts, bank statements, tax returns, or property deeds to show when and how each asset was acquired. Here’s how to handle common types of property:

• Real estate: If a house was purchased during the marriage, it’s typically considered marital property, regardless of who is listed on the title. If one spouse owned the home before the marriage, it may be considered separate property unless both spouses contributed to its upkeep or paid off the mortgage during the marriage.
• Bank accounts: Any income earned during the marriage is generally considered marital property, even if it’s kept in separate accounts. However, funds that were in one spouse’s account before the marriage or received as a gift or inheritance can remain separate as long as they aren’t mixed with marital funds.
• Retirement accounts: Retirement accounts and pensions earned during the marriage are considered marital property. However, any portion of the account that was accrued before the marriage is typically classified as separate property. In these cases, the court may use a formula to divide the marital portion of the retirement account.
• Business ownership: If one spouse started a business before the marriage, it may be considered separate property. However, if the business grew during the marriage due to joint efforts or marital funds, part of the business may be classified as marital property.
• Gifts and inheritances: Gifts or inheritances received by one spouse during the marriage remain separate property, provided they are not commingled with marital assets. For example, if a spouse inherits money and keeps it in a separate account, it’s considered separate property. However, if the inheritance is used to purchase a marital asset, such as a joint home, it may be treated as marital property.

3. Handling Commingled Property

One of the biggest challenges in property distribution is dealing with commingled assets. Commingling occurs when separate property and marital property are mixed together in a way that makes it difficult to distinguish one from the other. 

For example, if one spouse used separate funds to pay for home improvements on a jointly owned property, the separate funds may be considered part of the marital estate.

In these cases, the court may consider both the original classification of the property and how it was used during the marriage to determine whether it should remain separate or be treated as marital property. If necessary, financial experts may be brought in to trace the origin of the funds and determine the proper classification.

4. Negotiating an Agreement

If you and your spouse agree on how to classify and divide your assets and debts, you can work together to create a separation agreement that outlines the terms of your property division. 

This agreement should specify which assets and debts are marital property and how they will be divided, as well as which assets are separate and will remain with each spouse.

Working with an experienced family law attorney is crucial during this stage to ensure that your rights are protected and that the agreement is fair and legally enforceable.

5. Court’s Role in Property Classification

If you and your spouse cannot agree on the classification or division of certain assets, the court will make these decisions for you. The court will review all relevant evidence, including documentation and testimony, to determine whether an asset or debt is marital or separate. 

Once the classification is made, the court will divide the marital property based on equitable distribution, considering factors such as each spouse’s financial contributions, the duration of the marriage, and each party’s needs.

How Devan & Null Can Help You Determine Marital and Separate Property

At Devan & Null PLLC, we understand how important it is to ensure that your property is classified and divided fairly during a divorce. 

With over 30 years of experience in North Carolina family law, Attorney Laura Devan will guide you through the process of identifying marital and separate property, ensuring that your rights are protected.

We work with you to:

• Assist in creating a complete inventory of your assets and debts to determine what is subject to division.
• Help you gather documentation to support your claims of separate property or establish the value of marital property.
• Work with financial experts to trace commingled assets and ensure a fair classification.
• Negotiate on your behalf to reach an agreement with your spouse or represent you in court if necessary.

If you’re preparing for property distribution in a divorce, contact Devan & Null PLLC today at 910-486-6855 to schedule a consultation. Let us help you navigate the complexities of marital and separate property with confidence.

Dividing complex assets such as retirement accounts, businesses, or real estate investments during a divorce can be challenging. 

In North Carolina, the principle of equitable distribution governs how marital assets and debts are divided, which means the court aims to divide property fairly, though not necessarily equally. 

When it comes to complex assets, this process can require careful valuation, negotiation, and sometimes court intervention to ensure a fair outcome. Understanding how the law treats these types of assets and how they’re divided can help you navigate the process with confidence.

Retirement Accounts and Pensions

Retirement accounts and pensions are often one of the most significant assets in a marriage. North Carolina law treats retirement accounts as marital property to the extent that they were earned or accrued during the marriage. 

Any retirement funds accumulated before the marriage are considered separate property and will remain with the spouse who earned them.

Types of Retirement Accounts

There are several types of retirement accounts that may be subject to division in a divorce, including:

• 401(k) Plans and IRAs: These accounts accumulate contributions over time, often through an employer. The portion of these accounts that was contributed during the marriage is subject to division.
• Pensions: Some pensions provide income upon retirement based on years of service. The portion of the pension earned during the marriage is subject to division.
• Military or Government Pensions: Military pensions and other government pensions may have special rules regarding how they are divided, often requiring specific steps for the division to be approved.

Dividing Retirement Accounts

To divide retirement accounts, a Qualified Domestic Relations Order (QDRO) may be required. A QDRO is a court order that instructs the retirement plan administrator on how to divide the account between spouses. It allows for the transfer of retirement funds without penalties or taxes to the non-employee spouse. Here’s how the process works:

• Valuation of the Account: First, both parties must agree on the value of the retirement account or have it appraised by a financial expert. The value as of the date of separation is typically used.
• Determine the Marital Portion: Only the portion of the retirement account accrued during the marriage is subject to division. For example, if a spouse contributed to a 401(k) both before and during the marriage, the court will divide only the contributions and growth that occurred during the marriage.
• Division of the Account: Once the marital portion is determined, the court or agreement will specify how the funds are divided. This could involve splitting the account equally, or one spouse may receive a greater share depending on the overall division of assets.

Retirement accounts can be complex to divide, and mistakes in the QDRO or agreement can lead to financial losses. Working with an experienced attorney and financial experts is essential to ensuring that retirement accounts are divided fairly and in compliance with tax laws.

Business Ownership and Interests

Business ownership is another complex asset that must be divided in a divorce. If one or both spouses own a business, determining the value of the business and how it will be divided can be one of the most contentious parts of the divorce process.

Is the Business Marital or Separate Property?

As with other assets, the first step is determining whether the business is marital property, separate property, or a combination of both. A business that was started during the marriage is generally considered marital property. However, if one spouse started the business before the marriage, part of the business may be considered separate property.

Even if a business was started before the marriage, its value may have increased during the marriage due to contributions from either spouse. If marital funds or labor were used to grow the business, the increased value may be subject to equitable distribution.

Valuing the Business

Business valuation is a critical step in the property distribution process. The court or the spouses will need to determine the business’s fair market value, which typically requires the assistance of a business appraiser or forensic accountant. The appraiser will consider various factors, such as:

• The business’s income and expenses
• Assets and liabilities
• Goodwill and reputation
• Market conditions and industry trends
• Ownership interests and agreements with partners or shareholders

Once the business is valued, the spouses can decide how to divide the asset.

Options for Dividing a Business

There are several ways a business can be divided in a divorce, depending on the couple’s circumstances:

• Buyout: In many cases, one spouse may choose to buy out the other’s interest in the business. This allows the spouse who owns or operates the business to retain full control while compensating the other spouse for their share. The buyout may be paid in a lump sum or through installment payments.
• Co-ownership: In some cases, the spouses may agree to continue co-owning the business after the divorce. This option is more common when both spouses are actively involved in the day-to-day operations of the business. However, this arrangement requires ongoing cooperation and communication, which can be challenging after a divorce.
• Sale of the Business: If neither spouse wants to retain ownership of the business, they may agree to sell it and divide the proceeds. This option can provide a clean break but may not be feasible if the business is difficult to sell or if both spouses rely on the income it generates.

Deciding how to divide a business can be one of the most complicated aspects of a divorce, requiring careful negotiation and, in some cases, court intervention. Having an experienced attorney who understands business valuation and property division is essential to protecting your interests.

Real Estate Investments

Real estate, whether it’s the family home or investment properties, is often one of the most valuable assets in a marriage. Dividing real estate can be particularly complex, especially if the properties were acquired during the marriage or if there is significant equity involved.

Marital vs. Separate Real Estate

As with other assets, the first step in dividing real estate is determining whether the property is marital or separate. If the property was purchased during the marriage, it is generally considered marital property. However, if one spouse owned the property before the marriage, it may be considered separate property unless both spouses contributed to its upkeep or mortgage payments during the marriage.

Options for Dividing Real Estate

When it comes to dividing real estate, there are several options:

• One Spouse Keeps the Property: One spouse may choose to keep the property and buy out the other spouse’s share. This is common in cases where one spouse wants to keep the family home for stability or sentimental reasons. The buyout amount is typically based on the current market value of the property minus any outstanding mortgage or other debts associated with the property.
• Sell the Property: In some cases, the spouses may agree to sell the property and divide the proceeds. This option can provide a clean financial break and allows both spouses to use the proceeds to secure new housing or pay off debts. However, selling the property may take time and could be affected by market conditions.
• Co-ownership: Some spouses may agree to continue co-owning the property for a period of time. For example, they may agree to keep the family home until the children finish school, at which point they will sell the property and divide the proceeds. Co-ownership requires clear communication and a detailed agreement to avoid future disputes.

Valuing Real Estate

Accurate valuation of real estate is essential to a fair division. This typically involves hiring a professional real estate appraiser to determine the current market value of the property. Factors such as the property’s condition, location, and market trends will all be considered in the valuation process.

How Devan & Null Can Help You with Complex Asset Division

At Devan & Null PLLC, we understand that dividing complex assets such as retirement accounts, businesses, and real estate requires more than just basic knowledge of North Carolina law. 

With over 30 years of experience in family law, Attorney Laura Devan will guide you through the process, working with financial experts and appraisers to ensure that all assets are properly valued and divided fairly.

We work with you to:

• Assist in valuing retirement accounts and handling QDROs to ensure that your retirement funds are divided in compliance with the law and without penalties.
• Work with business appraisers to determine the fair market value of any business interests and help you negotiate a fair division or buyout.
• Guide you through real estate division by securing accurate appraisals and exploring options that protect your financial interests, whether that means keeping the family home, selling property, or continuing co-ownership.
• Negotiate on your behalf to reach a fair and equitable settlement or represent you in court if necessary.

If you’re facing the division of complex assets in your divorce, contact Devan & Null PLLC today at 910-486-6855 to schedule a consultation. 

We help you navigate the process and protect your financial future.

In North Carolina, when a couple divorces, they are required to divide their marital property through a process known as equitable distribution. This means that marital assets and debts are divided fairly, though not necessarily equally, between the spouses. 

Ideally, both spouses can agree on how to divide their property, but if they cannot, the court will step in to make the decision for them. If negotiations break down and an agreement cannot be reached, going to court becomes necessary to resolve the dispute. 

Here’s an in-depth look at how this process works and what you can expect.

Negotiation and Mediation Before Court

Before taking property division issues to court, it’s always in both parties’ best interest to try to reach an agreement through negotiation. In many cases, couples can work with their attorneys to negotiate a settlement that is acceptable to both parties. 

This process often involves compromise and discussion about what each spouse considers to be a fair division of assets and debts.

Mediation is another option for couples who are struggling to agree on property division. Mediation is a process where a neutral third party, known as a mediator, helps the couple come to a mutually acceptable agreement. 

Mediators do not make decisions for the couple but instead facilitate discussions to help both parties reach a resolution. Mediation can save time, reduce costs, and keep control of the outcome in the hands of the couple rather than the court.

If mediation or negotiation is successful, the couple can create a separation agreement that outlines how their property will be divided. This agreement can then be submitted to the court for approval as part of the uncontested divorce process.

When Negotiation Fails: Going to Court

If you and your spouse cannot agree on how to divide your property, and mediation is unsuccessful or not an option, the next step is to go to court and let a judge decide how the property will be divided. 

In this case, the judge will follow North Carolina’s equitable distribution laws to divide marital assets and debts in a manner that is considered fair.

Here’s what to expect if your case goes to court:

Filing for Equitable Distribution

To begin the court process for property division, one spouse must file a claim for equitable distribution. This is usually done at the same time as filing for divorce, though it can be filed at any point before the divorce is finalized. 

If equitable distribution is not requested before the divorce is granted, the right to have the court divide the property is lost, meaning the court will not be able to help with property issues after the divorce.

Once the equitable distribution claim is filed, the court will schedule hearings to resolve the matter.

The Equitable Distribution Process in Court

The court process for equitable distribution involves several steps, including discovery, hearings, and, if necessary, a trial. Here’s how the process works:

1. Discovery: During discovery, both spouses exchange information about their assets, debts, and financial situation. This may include bank statements, tax returns, property appraisals, and other documentation that shows the value and ownership of the assets. Discovery helps both parties understand the full financial picture before going to court and ensures that all property is accounted for.
2. Identification of Marital and Separate Property: The first task for the court is to identify which assets and debts are considered marital property and which are separate property. Marital property is subject to division, while separate property is not. In North Carolina, marital property includes all assets and debts acquired during the marriage, while separate property includes assets that were owned before the marriage or acquired through gifts or inheritance.

• For example, if one spouse owned a house before the marriage, that house would generally be considered separate property. However, if the mortgage was paid using marital funds, or if the house increased in value due to improvements made during the marriage, part of the home’s value may be classified as marital property.

1. Valuation of Property: After the court identifies what is marital property, it must determine the value of each asset. This often involves hiring appraisers to determine the fair market value of real estate, businesses, vehicles, and other assets. Financial accounts such as bank accounts, retirement accounts, and investments will be valued based on their balance at the time of separation.
2. Equitable Division: Once the court has identified and valued the marital property, it will divide the assets and debts in a manner that is considered fair. North Carolina courts do not necessarily divide property equally. Instead, the court considers various factors to determine what is equitable. These factors include:
• The length of the marriage
• The income, property, and liabilities of each spouse
• Each spouse’s contributions to the marriage, both financial and non-financial (e.g., homemaking or child-rearing)
• The age and health of each spouse
• The need for one spouse to have a certain asset, such as the family home, for the benefit of minor children
• The tax implications of property division
• Any marital misconduct that may have affected the couple’s finances
3. Based on these factors, the court will decide how to divide the property, which may not always result in a 50/50 split. For example, if one spouse has significantly more earning potential or financial resources than the other, the court may award a larger share of the property to the lower-earning spouse.

What Happens in Court?

When your case goes to court, the judge will hear evidence from both sides about the assets and debts involved in the case. Both spouses, through their attorneys, will present evidence and arguments about what they believe to be a fair division of property. 

This may involve testimony from financial experts, appraisers, and others who can provide information about the value of the property.

Once the judge has heard all the evidence, they will issue a ruling on how the property will be divided. The court’s decision is legally binding, meaning both parties must comply with the ruling. 

The judge may order one spouse to transfer property to the other, sell assets and divide the proceeds, or divide retirement accounts through a Qualified Domestic Relations Order (QDRO).

Pros and Cons of Going to Court for Property Division

While going to court can resolve property disputes when negotiation fails, it’s important to understand the potential benefits and drawbacks of this approach.

Benefits of Going to Court

• Resolution of Disputes: If you and your spouse cannot agree on how to divide your property, the court can provide a clear and final decision, eliminating uncertainty and moving the divorce process forward.
• Legal Protection: A court-ordered property division ensures that both parties’ rights are protected and that assets are divided according to the law. This can be particularly important if one spouse is trying to hide assets or refuses to negotiate fairly.
• Enforcement: Once the court issues a ruling, it is legally binding. If one spouse refuses to comply, the other spouse can take legal action to enforce the order, ensuring that the property is divided as ordered.

Drawbacks of Going to Court

• Higher Costs: Going to court is more expensive than negotiating or mediating a property division agreement. Legal fees, court costs, and the expense of hiring appraisers or financial experts can add up quickly.
• Time-Consuming: Court cases can take months or even years to resolve, especially if the property division is complex or highly contested. This can prolong the divorce process and add stress to an already difficult situation.
• Loss of Control: When you go to court, you give up control over how your property is divided. The judge will make the final decision, and that decision may not align with your preferences. For example, the judge may order the sale of a home or business that one spouse hoped to keep.

How Devan & Null Can Help You Resolve Property Division Disputes

At Devan & Null PLLC, we understand that property division can be one of the most contentious aspects of divorce. 

With over 30 years of experience in North Carolina family law, Attorney Laura Devan is dedicated to helping you protect your financial future. Whether through negotiation, mediation, or court representation, we are here to advocate for your rights and ensure that you receive a fair share of the marital property.

We work with you to:

• Identify and value marital assets and debts, ensuring that nothing is overlooked.
• Negotiate on your behalf to reach a property division agreement that reflects your needs and priorities.
• Represent you in court if necessary, presenting a clear and compelling case for how property should be divided.

If you and your spouse cannot agree on how to divide your property, or if you need help understanding your rights in the property division process, contact Devan & Null PLLC at 910-486-6855 to schedule a consultation. Let us help you protect your assets and secure a fair outcome in your divorce.

Divorce is not just an emotional process; it also significantly impacts your financial future. In North Carolina, the process of dividing marital property is guided by the principle of equitable distribution, which means the court divides assets and debts fairly, though not necessarily equally. 

While the law provides a framework for dividing property, it’s crucial for you to take active steps to protect your financial future and ensure a fair distribution of assets during your divorce.

Understanding your rights, gathering the necessary documentation, and working with an experienced family law attorney can help you safeguard your interests throughout the process. 

Here’s a detailed guide to how you can protect your financial future and ensure fairness in the division of marital property.

1. Know What Constitutes Marital vs. Separate Property

One of the most important aspects of property division is distinguishing between marital property and separate property. Under North Carolina law, only marital property is subject to division during a divorce, while separate property remains with the spouse who owns it.

• Marital Property: This includes all assets and debts acquired by either spouse during the marriage. Examples include your home, vehicles, retirement accounts, savings, investments, and even debts like credit card balances or mortgages.
• Separate Property: This includes assets acquired before the marriage, as well as gifts or inheritances given to one spouse during the marriage. If these assets were kept separate and not commingled with marital funds, they will not be divided during the divorce.

To protect your financial future, it’s essential to accurately classify your assets and debts as either marital or separate. If your separate property was commingled with marital property (e.g., using an inheritance to pay off a marital home mortgage), you may need to trace the funds to prove the portion that remains separate.

Steps You Can Take:

• Keep detailed financial records: Gather documentation that shows when and how assets were acquired, including bank statements, tax returns, deeds, and receipts. This will help you prove what is separate property.
• Work with a financial expert: If you’re unsure about the classification of certain assets, such as commingled funds or complex investments, a financial advisor or forensic accountant can help trace the source of funds and determine what portion of the asset is marital or separate.

2. Gather and Organize Financial Documents Early

One of the best ways to protect your financial interests during a divorce is to have a clear understanding of your financial situation. Before negotiations or court proceedings begin, it’s important to gather and organize all relevant financial documents. This includes not only your income and assets but also any debts or liabilities you share with your spouse.

Key Documents to Collect:

• Bank account statements (checking, savings, and joint accounts)
• Retirement account statements (401(k), IRA, pensions)
• Mortgage and loan documents
• Tax returns for the past few years
• Credit card statements and outstanding debts
• Property deeds or titles (for homes, vehicles, real estate investments)
• Business financial records (if you or your spouse owns a business)
• Appraisals for valuable assets, such as jewelry or art

Having these documents readily available will help ensure that all assets are properly accounted for and valued during the division process. It also allows your attorney to better advocate for your financial interests, whether you’re negotiating an agreement or going to court.

3. Consider the Tax Implications of Property Division

One aspect of property division that is often overlooked is the tax implications of dividing assets. Not all assets are created equal, and while certain property may seem valuable on paper, taxes can significantly affect its true value after the divorce.

For example:

• Retirement accounts: If you or your spouse withdraws funds from a retirement account as part of the property division, those withdrawals could be subject to income taxes and penalties. Using a Qualified Domestic Relations Order (QDRO) to divide retirement accounts can help you avoid early withdrawal penalties.
• Home equity: If you receive the marital home in the divorce, you may also inherit the tax liability associated with selling the home in the future. Understanding the capital gains tax implications is important before deciding to keep the home.
• Investment accounts: If you receive stocks or other investments as part of the property settlement, you may be responsible for paying capital gains taxes when you sell them. It’s important to factor in these future taxes when assessing the true value of the assets you’re receiving.

Steps You Can Take:

• Consult a tax professional: Before agreeing to a property division, it’s a good idea to work with a tax advisor who can help you understand the tax consequences of dividing specific assets. This can prevent unexpected tax liabilities down the road.
• Plan for long-term financial goals: Consider how the assets you receive in the divorce align with your long-term financial goals. For example, keeping the marital home may provide stability, but selling it and dividing the proceeds might better serve your financial future if maintaining the home would be a financial burden.

4. Plan for Debt Division

Equitable distribution in North Carolina applies not only to assets but also to debts. Marital debts, such as mortgages, car loans, and credit card balances, must be divided between the spouses. However, how debts are divided can significantly impact your financial future, so it’s important to protect yourself from being burdened with an unfair share of the marital debt.

Understanding Debt Division:

• Marital Debts: Debts incurred during the marriage for the benefit of both spouses (such as a home mortgage or joint credit card) are generally considered marital debts, regardless of whose name is on the account.
• Separate Debts: Debts that were incurred by one spouse before the marriage or for personal expenses that didn’t benefit the marriage may be considered separate debts.

Steps You Can Take:

• Review all debts: Ensure that all marital debts are accurately accounted for and that you have a clear understanding of who is responsible for each debt. This includes reviewing joint credit cards, personal loans, and any debts in your spouse’s name that benefited the marriage.
• Negotiate responsibility: If you are awarded certain assets, such as the family home, make sure the associated debts, such as the mortgage, are taken into account. Similarly, if your spouse is awarded a car, they should take responsibility for the car loan.
• Ensure debts are in the right name: If one spouse is responsible for a debt after the divorce, make sure the debt is transferred into their name. Otherwise, if your name is still on a joint credit card or loan, you could be held responsible if your ex-spouse fails to make payments.

5. Work with an Experienced Attorney

The most important step you can take to protect your financial future during a divorce is to work with an experienced family law attorney. Divorce, especially when complex assets are involved, requires careful planning and legal expertise. 

An attorney helps you navigate North Carolina’s equitable distribution laws, ensure your rights are protected, and advocate for your financial interests.

How an Attorney Can Help:

• Identify and classify assets: Your attorney helps you identify which assets are marital and which are separate, ensuring that you receive your fair share of the marital estate.
• Negotiate a favorable settlement: A skilled attorney can negotiate on your behalf to reach a property division agreement that reflects your financial needs and goals. This includes negotiating the division of retirement accounts, real estate, businesses, and other valuable assets.
• Represent you in court: If you and your spouse cannot agree on property division, your attorney represents you in court and present a strong case for why you should receive a fair portion of the marital assets. This includes advocating for an equitable division of both assets and debts.

How Devan & Null Can Protect Your Financial Future

At Devan & Null PLLC, we understand that protecting your financial future is one of the most important aspects of your divorce. 

With over 30 years of experience in North Carolina family law, Attorney Laura Devan guides you through the equitable distribution process and ensures that your rights are protected. Whether you’re negotiating a property division agreement or preparing for court, we help you achieve a fair and equitable outcome.

We work tirelessly to:

• Assist you in gathering and organizing financial documents to ensure that all assets and debts are accounted for.
• Work with financial experts to accurately value your assets, including businesses, real estate, and retirement accounts.
• Negotiate a favorable property division settlement or represent you in court if necessary to protect your financial future.

If you’re concerned about protecting your financial future during your divorce, contact Devan & Null PLLC at 910-486-6855 to schedule a consultation. We’re here to guide you through the process with personalized attention and expert legal support.