The statistics for termination of marriages in the United states are pretty grim. The latest statistics claim roughly 50% of first marriages end in divorce. Second or third marriages have only about 20% of couples remaining happily married.
On the dissolution of the marriage by divorce, there are a number of issues to be dealt with including child custody, support, and equitable distribution of assets.
In Pennsylvania, marital assets and debts of a divorcing couple are divided between them in a process called "equitable distribution." "Fault" or misconduct within a marriage that's ended is generally not a factor in determining the fair division of marital property during the equitable distribution decision.
Here are some of the factors that are considered in making the decision:
• The length of the marriage
• The existence of any prior marriages
• The age, health, station, income, vocational skills, employability, estate, liabilities and needs of each party
• Any contribution by one party to the education, training or increased earning power of the other
• Each party's opportunities for future acquisitions of capital assets and income
• Sources of income of both parties, including medical, retirement, insurance or other benefits
• Roles of each party in the acquisition, preservation, depreciation or appreciation of marital property, including contributions as homemaker
• Property values set apart to each party
• The parties' standard of living established during the marriage
• Your individual economic circumstances when the division of property becomes effective
• Tax ramifications associated with each asset to be divided
• Expenses related to a sale, transfer or liquidation associated with a particular asset
• Determination of which party will serve as the custodian of any dependent minor children
Generally, marital property means all property acquired by either party during the marriage, regardless of whose name it is in.
In Pennsylvania, separate or nonmarital property is not subject to equitable distribution. Nonmarital property includes property that a spouse brought into the marriage and kept separate during the marriage, inheritances received during the marriage and kept separate during the marriage, gifts received by just one spouse during the marriage and kept separate, and property excluded by a valid prenuptial agreement.
There is a very important distinction to be made here. While nonmarital property remains the individual property of the spouse who owns it, the increase in value during the marriage of nonmarital property is considered to be a marital asset and is subject to equitable distribution.
Here is an example: Let's say Husband inherited $100,000 from his grandmother and kept it in a separate account in his name only. The $100,000 was invested; and at the time of the couple's separation, was worth $150,000. The original $100,000 remains separate property, but the $50,000 increase in value is marital property subject to equitable distribution.
On the other hand, a different result is reached if the inherited $100,000 is co-mingled with marital property. If Husband deposits the $100,000 inheritance into a joint account with Wife or spends it on a joint asset, then the separate property loses its status as separate property and becomes marital property. If it is marital property, it's in the "pot" and will be divided like any other asset. In our example if the $100,000 is in a joint account and grows to $150,000 then the whole $150,000 is marital property.
The Pennsylvania statute provides that the increase in value of nonmarital property is measured from the date of marriage or later acquisition date to either the date of final separation or the date as close to the hearing on equitable distribution as possible, whichever date results in a lesser increase. Any decrease in value of the nonmarital property of a party is offset against any increase in value of the nonmarital property of that party. However, a decrease in value of the nonmarital property of a party shall not be offset against any increase in value of the nonmarital property of the other party or against any other marital property subject to equitable division.
If the marriage has deteriorated or may deteriorate, you should think carefully about what to do with a gift or inheritance. Since the future is always uncertain, the best course is to keep nonmarital property separate.