Marital property is distributed in Massachusetts divorce cases under the “equitable distribution” standard. Unlike some other states with “community property laws,” Massachusetts courts divide marital property in an equitable, or fair, manner.
What is Marital Property?
In Massachusetts, marital property includes all items, interests, and possessions attained by a couple during their marriage. Marital property in Massachusetts is not considered to be property that is acquired by any party before the marriage began. Property someone acquires before the marriage is typically separate property that the court will not divide.
Separate Property
Under some circumstances, separate property may count as marital property: for example, a long-term marriage where the parties’ have very unbalanced separate property. One spouse entered the marriage with considerable assets while the other had few assets at the time. The parties may have become accustomed to a certain standard of living during their marriage; the judge may consider some separate property (acquired prior to the marriage) to be marital property, in the interests of fair and equitable division. This consideration is dependent on the facts and circumstances of each individual divorce case. It is important to speak with a competent divorce attorney about this issue of marital and separate property.
Division by Agreement
Parties in a marriage may decide that they want to divide their property on their own. They can do this by agreeing on which property to divide. Once an agreement is made, it is written down as a “property settlement agreement”. Parties submit the agreement to divide property to a Massachusetts Probate and Family Court. The judge then considers the agreement in the final divorce order. A judge would likely support a fair and reasonable distribution of their assets.
Equitable Distribution
If the parties cannot agree about the division of property on their own, a Massachusetts Family Court will divide the parties’ property on an equitable basis. Equitable does not necessarily mean equal. Equitable uses several factors to determine the fair division of assets. These factors include: length of the marriage; conduct of the parties during the marriage; age, health, station, occupation, amount and sources of income, vocational skills, employability, estate, liabilities and needs of the parties; opportunity of each for future acquisition of capital assets and income; amount and duration of alimony; present and future needs of dependent children of the marriage; and contribution of each of the parties in the acquisition, preservation or appreciation in value of their respective estates and the contribution of each of the parties as a homemaker to the family unit.
Types of Marital Property
Property in a divorce could be any of the following: house(s) and real estate, car(s), furniture, art, jewelry, bank accounts, bonds, boats, policies, plans, pensions, stock options, accounts, coin or collections, wine collections, and more. While Massachusetts considers companion and other animals to be property, judges in Massachusetts may look to see the party who is the primary handler of the animal. There is a growing trend in other states that companion animals will be awarded to a party based upon what is best for the animal. This standard is not yet in Massachusetts; dogs and cats, and other animals count as property.
There are some other assets that a party in a divorce may be entitled to: stock retirement accounts (401K and pension plans), deferred compensation plans from previous employers, capital losses from previous tax years, cemetery plans or plots, all collections with value, memberships to clubs, gifts, intellectual property such as trademarks, patents, copyrights, and royalty rights, lottery tickets, loans, travel rewards, and more.
What About a Business?
If a party owns a business, it is also important to speak with a Massachusetts divorce lawyer about the ways that business ownership may impact the distribution of property in a divorce, especially as business gains are managed and salaries are paid.
To provide an example: Billy and Jean decide to divorce. Billy, a musician, owns an upcoming music label, which he created after he married Jean. He also owns the rights to several of his original songs that he recorded on his label. Billy and Jean have a joint bank account that they opened prior to their marriage, but that they regularly used during their 5-year marriage. The couple has a house, no kids, and Jean does not work. They each have a vehicle, but Billy’s car is worth two times more than Jean’s car.
What property can the judge distribute? In Massachusetts, absent a marital agreement, a judge would likely consider the business earnings and future royalty earnings in the divorce decree. The judge would also equitably divide their earnings, the joint account, the value of the house, and their vehicles in an order for the equitable distribution of their property.
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