The division of property upon a divorce in New York State is referred to as Equitable Distribution and is governed by Section 236(B) of the Domestic Relations Law. Without a divorce, property will not be distributed.
Unless the parties have agreed in advance to the distribution of their property by valid prenuptial, separation or other written agreement, the court in an action for divorce must determine the rights of the parties to their separate and marital property and provide for the disposition of such property in the final judgment.
Equitable Distribution in New York
Equitable Distribution of marital property is determined by the court after the court’s mandatory consideration of a number of factors, including:
- Income and property of each party at the time of marriage and at the time of commencement of the action for divorce
- Duration of the marriage and the age and health of the parties
- Need of a custodial parent to occupy or own the marital residence and to use or own its household effects
- Loss of inheritance and pension rights upon dissolution of the marriage
- Loss of health insurance benefits upon dissolution of the marriage
- Any award of maintenance payments
- Direct or indirect contributions made to the acquisition of marital property by the non-titled spouse, including those as spouse, parent, wage earner and homemaker, and to the career or career potential of the other party
- Liquidity of the marital property
- Probable future financial circumstances of each party
- Impossibility or difficulty of evaluating any asset or interest and the economic desirability of retaining that asset free from claim by the other party
- Tax consequences
- Wasteful dissipation of assets by either spouse
- Any transfer or encumbrance made in contemplation of a matrimonial action without fair consideration.
The court may also consider any other factor which the court finds to be just and proper under the circumstances of the case.
Full disclosure of financial circumstances by both parties is essential in determining Equitable Distribution. The court requires that the parties exchange pertinent financial documents, including income tax returns, W-2 forms, 1099 forms, statements K-l, paystubs, statements of account for all financial assets, including bank accounts, retirement accounts and other investments, statements pertaining to life insurance policies having a cash value, and a sworn statement of net worth in the official form required by the State of New York.
Each party is entitled to retain experts to evaluate marital assets. For example, parties may retain appraisers to determine the fair market value of real estate and special evaluators to determine the values of retirement accounts, degrees or licenses earned during the marriage, business interests and significant personal property.