Minnesota is a “no fault” divorce state, which means courts will not financially punish or reward a party when dividing assets and debts because of good or bad behavior during the marriage. Generally speaking, the courts will “equitably” divide the marital assets and liabilities between the parties. Disputes arise over whether an asset is “marital,” and therefore subject to division, or “non-marital,” in which case one party is entitled to the asset without consideration to the other party.
The general definition is that anything acquired during the marriage is marital and anything owned or acquired prior to the marriage is non-marital. However, there are many exceptions to this general rule. All assets and debts are presumed to be marital and subject to division, unless the party asserting a non-marital claim is able to prove otherwise. The party must be able to “trace” the asset to its non-marital source, usually through a paper trail of receipts, invoices, deposit slips, bank or investment statements or other documentary evidence. The matter becomes further complicated, because some assets such as real estate, retirement accounts and investments, can be partially marital, and non-marital at the same time.
The marital assets in a divorce are to be divided “equitably” between the divorcing parties. “Equitably” often means equally dividing the assets, although there are circumstances where an “equitable” division of the assets may not necessarily be “equal.” One example is a party may receive a greater share of the marital assets to make up for lower earnings or earning potential following the divorce.
Awarding a party a greater share of income producing assets may be an equitable division that will also provide a party an additional source of income following the divorce. Each case is unique, and the Court has considerable discretion to craft a property division that the court deems “equitable” based upon the facts of each case.
If you are faced with divorce or legal separation, we would be happy to meet with you to answer your questions. We are experienced family law attorneys and will protect your interests.