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What New Jersey’s “Equitable Distribution” Rule Means for Your Divorce

June 16, 2017 | Posted In Family Law

In New Jersey, divorcing spouses must divide their marital assets in accordance with the rule of “equitable distribution.” Unlike community property states, in which there is a presumption that each spouse is entitled to one half of the marital estate, in New Jersey, the focus is on ensuring a “fair” (though not necessarily equal) distribution.

What Divorcing Spouses in New Jersey Need to Know about “Equitable Distribution”

If you are preparing to go through a divorce, it is important to understand how New Jersey’s equitable distribution rule applies to your personal circumstances. Here are some basic considerations to keep in mind:

1. Equitable Distribution Applies to Property Division Only.

New Jersey’s equitable distribution rule applies to spouses’ marital property. Alimony, child support and college expenses are all governed by different legal principles. The New Jersey courts have established multi-factor analyses for awarding alimony and apportioning the costs of education, and child support calculations are subject to the New Jersey Child Support Guidelines.

2. There are Different Ways to Equitably Distribute a Marital Estate.

When it comes to crafting an equitable distribution, the options are only limited by the scope and value of the couple’s estate. Spouses have broad leeway to negotiate the division of their property; and, when necessary, they can use mediation, litigation or the collaborative process to arrive at mutually-agreeable terms. While seeking a court-ordered property distribution is an option, most couples are able to negotiate property settlement agreements.

3. Spouses Must Also Equitably Distribute Their Debts.

When dividing your marital assets, it is important not to overlook your shared debts. While it will often make sense for assets and debts to stay together (i.e. the spouse who keeps the family home will take on sole responsibility for the mortgage), there are other options available. Also, joint creditors are not required to recognize divorcing spouses’ debt allocations; so, even if your spouse agrees to pay off a joint car loan, you could still face personal liability if he or she fails to do so. Fortunately, there are creative ways to address this issue as well.

4. Only Marital Assets are Subject to Equitable Distribution.

In the context of a divorce, there are marital assets, and then there are separate assets. Only marital assets are subject to equitable distribution.

Generally speaking, assets acquired during the marriage – whether jointly or by one spouse independently – will be considered marital assets. Assets owned prior to the marriage will be considered separate. However, there are some important exceptions, and it is critical for divorcing spouses to have a clear picture of their marital estate.

5. Spouses Can Seek to Protect Specific Assets During Their Divorce.

What if you want to keep specific assets following your divorce, such as a prized collection or the family residence? There are strategies available, and for more information we encourage you to read: Protecting Assets with Sentimental Value in a Divorce.

Contact Our New Jersey Divorce Lawyers

If you are preparing to go through a divorce in New Jersey, our attorneys can help you develop and execute a strategy designed to achieve your desired outcome. To get started with a confidential consultation, call 1-877-435-6371 or inquire online today.


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