How Is Marital Property Determined in New Jersey?

Getting divorced can feel like venturing into the unknown. In addition to the emotional toll of getting divorced, you may find yourself navigating logistical and practical issues, from child custody to living arrangements. Each issue has nuances, but one of the most complex can be the division of assets.

Understanding your division of assets during divorce is about more than dividing up furniture and appliances. It means deciding how all assets, from real estate property to retirement accounts, are split between you and your soon-to-be ex-spouse. 

These considerations can significantly impact both short- and long-term plans and goals, so it’s essential to seek the advice of a knowledgeable family law attorney.  

New Jersey marital property laws at a glance

Marital property laws in New Jersey recognize that some property and assets are owned by the marital unit while others are not. These laws provide a basic framework for:

• Determining which assets belong to both parties in a marriage 
• Identifying assets that belong to individuals
• How to distribute assets between parties
• Terms of the division of assets

What is marital property or a marital asset?

In New Jersey, marital property is defined as any asset acquired during a marriage. 

New Jersey is an equitable distribution state, meaning that the title to a property does not define its status as marital property. Any asset you purchase or gain during the marriage may be regarded as marital property. 

For example, if you purchase a car and put only your name on the title, it is still considered property acquired during the marriage. If you start a lucrative business while married, it may also be considered marital property, depending on your situation.

Moreover, the property you owned before the marriage can also become marital property if it is commingled during the marriage. For example, suppose you owned a house before you got married but then added your spouse’s name to the mortgage. This action transforms the home into marital property. And even if you don’t add their name, the house may be considered marital property if they pay for a significant share of the mortgage.

What is non-marital property?

Anything that you or your spouse owned before the marriage, even if it was a gift from one to the other, is usually considered to be separate property. However, increases in value to such premarital property may be considered marital assets if such increase was due to the active management of such property. 

Some assets you can acquire during marriage don’t count as marital property. The most common example is a gift you receive from someone who is not your spouse. As long as that gift was specifically for you—and you don’t commingle it with marital property—it remains solely yours.

The same rule applies to any inheritance you may have received while married. As a result, if you wish to prevent money from an inheritance from becoming joint property, it can help to maintain it in a separate bank account. 

Note that you may not hide assets from your ex-spouse during the divorce process. Doing so can have a negative impact on the outcome of your divorce settlement, as well as other legal consequences.

Equitable distribution

New Jersey is an equitable distribution state, which means that if you and your ex-spouse cannot decide how to divide your assets and debts upon divorce, the courts will do so based on the principle of equitable distribution. An equitable distribution is what is considered fair and appropriate for the circumstances, but it is not necessarily an equal split.

Judges use several state-defined criteria to determine what is reasonable for both parties in a divorce. Still, you and your lawyers can present arguments about your needs and the specific facts of your case. 

However, unless you and your spouse agree on a distribution plan, a judge will make the final decision.

Keep in mind that litigation is not the only option for resolving issues like division of assets. Working with a court-certified family law mediator can provide a flexible, collaborative path for parties to determine jointly how their marital property should be split between them. Because mediation is more flexible and collaborative, divorcing couples have increased control over their timeline, outcomes, and even costs associated with the process.  

Determining factors

The main factor that determines division of assets in any divorce is a pre- or post-nuptial agreement if one exists. However, for many marriages, there is no such agreement. Furthermore, even if one does exist, it may not cover all marital property. As a result, some intervention might be necessary.

When deciding how to divide up marital assets, the court will consider the following factors:

• The length of the marriage
• Each spouse’s income
• Any additional assets or debts owed by individual spouses
• What each spouse contributed to the marriage (including the work of child-rearing and homemaking)
• The relative health and age of each spouse

How can I protect my marital assets in a divorce?

While it is relatively easy to protect individual assets during a divorce in New Jersey, marital assets can be more challenging to hold onto. However, you can help protect the marital assets that are most important to you by negotiating a divorce agreement through mediation.

If you negotiate a divorce agreement, the courts will typically respect it as long as the terms are legal, and this is usually the case as long as both sides are represented by competent attorneys.

Mediation allows you to find a settlement that is acceptable for both sides. It can involve negotiating away assets you care less about to ensure that you maintain the assets you care about most. Furthermore, because mediation is often less costly than a trial, you and your spouse could end up with more at the end of the divorce.

Consult with an attorney

Many factors and nuances are involved in determining marital property in New Jersey. A family lawyer from Dughi, Hewit & Domalewski can be your ally in navigating how to handle marital property to protect your most important assets, determine a fair division of property, and take some of the emotional and financial stress out of the divorce process.

To protect your rights and financial future, schedule your consultation with our team today.