Property and Debt Division in a New Jersey Divorce

New Jersey Property Division FAQ's,
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by Honorable Anne Kass

How property and debts are divided when you get divorced:

New Jersey is an "equitable property" state. This means that all marital property acquired during the marriage should be divided equally. The "marital" property, consisting of any other property acquired by either spouse during the marriage, will be divided equally, unless the court finds that equal division would be unjust. Any property possessed by either spouse during the marriage is presumed to be marital property unless it can be shown that the property is actually separate property. A court can determine the rights of the spouses in any pension or retirement plan or their rights under any insurance policy.

How is property divided at divorce?

It is common for a divorcing couple to decide about dividing their property and debts themselves, rather than leave it to the judge. But if a couple cannot agree, they can submit their property dispute to the court, which will use state law to divide the property.

Division of property does not necessarily mean a physical division. Rather, the court awards each spouse a percentage of the total value of the property. (It is illegal for either spouse to hide assets in order to shield them from property division.) Each spouse gets items whose worth adds up to his or her percentage.

  • Equitable distribution. Assets and earnings accumulated during marriage are divided equitably (fairly). In practice, often two-thirds of the assets go to the higher wage earner and one-third to the other spouse. Equitable distribution principles are followed everywhere except the community property states listed just below.

How do we distinguish between marital and non-non-marital property?

Very generally, here are the rules for determining what's Marital property and what isn't:

  • Marital property includes all earnings during marriage and everything acquired with those earnings. All debts incurred during marriage, unless the creditor was specifically looking to the separate property of one spouse for payment, are marital property debts.
  • Non-marital property of one spouse includes gifts and inheritances given just to that spouse, personal injury awards received by that spouse, and the proceeds of a pension that vested (that is, the pensioner became legally entitled to receive it) before marriage. Property purchased with the separate funds of a spouse remain that spouse's separate property. A business owned by one spouse before the marriage remains his or her separate property during the marriage, although a portion of it may be considered Marital property if the business increased in value during the marriage or both spouses worked at it.
  • Property purchased with a combination of separate and marital funds is part marital and part non-marital property, so long as a spouse is able to show that some separate funds were used. Non-marital property mixed together with marital property generally becomes marital property.

Who gets to live in the house during the divorce?

If children are involved, the parent who spends the most time with the kids, or provides their primary care, usually remains in the marital home with them. If you don't have children and the house is the separate property of just one spouse, that spouse has the legal right to ask the other to leave.

If, however, you don't have children and you own the house together, this question gets tricky. Neither of you has a legal right to kick the other out. You can request that the other person leave, but he or she doesn't have to. If your spouse changes the locks, or somehow prevents you from entering the home, you can call the police. The police will probably direct your spouse to open the door. When you both own the home, the only time you can get your spouse to leave is if domestic violence has been committed and a judge grants a restraining order.

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