New Jersey is one of several states that uses equitable distribution to divide assets in a divorce proceeding. This law requires that the marital property is distributed fairly, rather than equally. The assets are not considered community property to be split evenly. Based on the judge’s discretion in each case, each spouse receives a fair share of the net value attributed to the marital property. The net value of the marital property is the difference between the total assets and any outstanding debts.
Marital vs non-marital property
Equitable distribution requires identifying the difference between marital property and separate property. Marital property is defined as assets acquired by either spouse during the marriage. Marital property also includes earnings and anything obtained with the earnings. Debts incurred during the marriage are also considered marital property. Non-marital property are gifts or assets specifically attributed to one spouse or those obtained prior to marriage.
Factoring in equitable distribution
There are a number of factors courts consider when determining equitable distribution in a divorce proceeding. Courts consider the duration of the marriage, the ages and overall health of both parties, and the income, property or assets each party brought into the marriage. The courts consider the standard of living established in the marriage and the economic outlook for each party once the divorce is finalized. The court also considers any written agreements the couple already has for property division.
Some of the other factors considered in equitable distribution include educational background, custodial responsibilities to the children, work experience and employment skills for each party. The court will also consider the amount of work needed to regain self-sufficiency and the standard of living enjoyed during the marriage. The tax implications of the proposed distribution are also considered before the divorce is finalized.