Distributing Property

Division of property, also called equitable distribution of property, is one aspect of the break-up of a marriage. Property division may occur before but not after the divorce.

There are two approaches to property division—
(1) a Separation Agreement and Property Settlement, or
(2) a court action for Equitable Distribution.

Rice Law attorneys can help you decide the best approach.

Common Questions

• What is equitable distribution of property?
• What factors do the courts consider?
• How do we equitably distribute our property?

What is equitable distribution of property?

When dividing marital property during a divorce, North Carolina law employs equitable distribution of marital property. Equitable distribution doesn't always split property equally (i.e., not fifty-fifty). With equitable distribution, the court considers "distributional factors", the classification of property (marital, separate, or mixed), and other factors. Both assets and debts are considered during property distribution.

What factors do the courts consider?

When determining property distribution cases, North Carolina courts divide the marital property equally between the parties unless they determine that such division is not equitable.

Typical factors considered include:

• Actions taken by either party to preserve or waste marital assets
• Age of the spouses
• Contribution to the education or earning potential of the dependent spouse
• Direct contributions to increase property value
• Duration of the marriage
• Expectation of retirement sources, such as pension and other deferred compensation rights that aren't marital property
• Income, property, and liabilities
• Needs of the custodial parent
• Nature and type of property
• Obligation for support from previous marriages
• Physical and mental health of the spouses
• Value of interest in a business
• Any other factors deemed relevant by the court

How do we equitably distribute our property?

Whether distribution is performed by you and your attorney or the courts, the typical steps involved in equitable distribution of property are essentially the same:

1. Determine which property is marital and which is separate – jointly purchased property that was owned on the date of separation is generally marital property; property owned before marriage, inheritances, and gifts are separate property. There are legal nuances to these general statements; consult your attorney.
2. Identifying the fair market value on each item that is marital property – appraisals and experts are consulted; fair market value is what a willing buyer would pay.
3. Distribute the property in an equitable manner – if the court is making this decision, they consider many factors. If done by the spouses, the spouses may agree on virtually any arrangement.