How Is Property Divided in a Divorce in Indiana?

Indiana is a “one-pot” property division state, so the court will begin with a presumption that all property is marital property and that it should be divided equally. But this can be overcome and will not necessarily mean that the final division will be equal. For this reason, it is imperative that each person has his or her own divorce lawyer during the division process.

Determining Marital and Separate Property

The court’s first duty will be to identify all property owned (and all debt owed) by each party. Each side needs a divorce attorney when this process begins to ensure that the division will be fair. In most cases, property that each spouse acquires after the wedding ceremony is marital property. Property that each person earned before the marriage can be considered to be separate property but the party must be prepared to prove that they owned the property before the marriage.

Exceptions to the Rule

If one spouse receives an inheritance or a gift, this property can be determined to be separate property. But if that property is mixed with marital property, for example if it was placed in a joint bank account, the court may determine that this account is marital property. This is an instance when a family law attorney is particularly necessary.

After the court decides whether the property is marital or separate, it will divide this property in an equitable manner, starting from a presumption of an equal division. The reason that people need to hire a law firm like Yoder & Jessup is so that someone knowledgeable in the laws of Indiana can explain that equitable does not necessarily mean equal. One spouse may have the right to ask for a greater portion of the property, and the court could conclude that this would be equitable.

Unequal Division

One spouse may make a case for dividing the assets unequally, but this is going to require the help of a divorce lawyer. It will be the spouse’s duty to convince the judge that an unequal distribution of assets would be equitable. The reasons that the court may consider an unequal division of assets include the following:

 

  • One spouse earns significantly more money than the other spouse. In this case, the judge can decide that the spouse with lower earning potential deserves more than 50% of the marital property.
  • Dissipation of assets: For example, it may be a dissipation of assets when one spouse pays for the living accommodations for his or her extramarital affair. Or if a spouse sells a very expensive asset for $5 just to keep the other spouse from having it. Or, lastly, it may be a dissipation of assets if a spouse cashes in his retirement fund to pay for a gambling addiction. In the event that there is a dissipation of assets, the court can take this into consideration when determining how to divide the marital property.
  • The court will consider the financial circumstances of each spouse before dividing the assets. If the custodial parent cannot afford to purchase a new home, the judge may award the marital home to the custodial parent.
  • One spouse may have had more money than the other spouse at the beginning of the marriage. In that case, this spouse would need a divorce attorney to make sure that he or she can receive a larger percentage of the assets by keeping those assets separate from the division.
  • Contributions that do not produce any income may also be considered during this process. One example of a non-income contribution is when someone helps his or her spouse build a business. The spouse may be so involved in the business that he went to networking functions with his spouse. In this case, the judge can decide that this spouse made important contributions to the other spouse’s business and deserves a greater portion of the assets. If one spouse is a stay-at-home parent, the judge may state that this spouse contributed to the marriage by being the main caregiver to the couple’s children. Because of it, the couple saved money on daycare expenses, or that spouse lost future earning ability by delaying their career.
  • If a spouse received an inheritance from his or her family, he or she will need Yoder & Jessup to ensure that this asset is kept separate from the marital property. The attorney may argue that requiring one spouse to share his or her inheritance with the other spouse wouldn’t be fair, but each judge has the authority to rule at his or her own discretion.

Equal Division

Sometimes, marital assets can be divided equally, and the court may decide that this would be the most reasonable way to approach this issue. This doesn’t necessarily mean that each asset can be divided into equal parts. For instance, one spouse may be awarded the marital home that is worth $400,000. In turn, the other spouse would be entitled to receive marital assets in the amount of $400,000. A family law attorney will be needed in this case because the court will have to determine the monetary value of each marital asset before they can be equally divided.

Reaching an Agreement

In Indiana, divorcing couples are strongly encouraged to come to an agreement about the division of property outside of the courtroom. Each individual must be prepared to make compromises when necessary because these types of negotiations rarely work if the couples are constantly fighting. If this cannot be done, the only alternative is to go to court and allow the judge to divide the marital assets for the couple.

Prenuptial/Postnuptial Agreements

People can avoid the hassle of having to negotiate with a spouse over the division of assets. They may decide to whom the marital assets will go before anyone asks the other for a divorce by having a divorce attorney draw up a prenuptial or postnuptial agreement.

Serving the counties of Noble, Steuben and LaGrange, and the surrounding area, the family law attorneys at Yoder & Jessup P.C. are prepared to formulate a plan of action that can help to ease the burden, clear the legal confusion, and aggressively seek resolution of these tough issues.