Divorce proceedings can often be contentious, particularly in regards to property division. The complications increase when a trust is involved. In New Hampshire, trusts are commonly used to safeguard assets. However, determining how property acquired through a trust during marriage should be divided in a divorce can pose a challenge.
Understanding The Different Types of Property
To gain a clearer understanding of how property acquired through a trust during the marriage should be divided in a New Hampshire divorce, it is essential to grasp the different types of property involved. Essentially, two types of property exist: marital property and separate property.
Marital property refers to any property acquired by either spouse during the course of the marriage, making it eligible for division in a divorce proceeding. On the other hand, separate property encompasses all assets owned by either spouse before the marriage or acquired independently from the marriage, including inheritances or gifts.
How Is Property That Was Acquired Through A Trust During The Marriage Treated?
The treatment of property acquired through a trust during the marriage is not always straightforward. As a general rule, such property is considered separate property and is not subject to division during divorce. However, there are exceptions to this rule.
Exception 1: The Trust Property Was Co-Mingled With Marital Property
If property acquired through a trust during the marriage becomes intermingled with marital property, it can become challenging to determine the proportion that is marital versus separate. In such cases, a judge may order a forensic accounting to trace the assets and ascertain the appropriate division.
Exception 2: The Trust Property Was Used For The Benefit Of The Marriage
Complications may arise in the division of property acquired through a trust when the trust property was utilized for the benefit of the marriage. For instance, if a trust purchased a home for the couple to reside in during the marriage, it may be deemed marital property subject to division.
Exception 3: The Trust Property Was Used To Benefit One Or Both Spouses Individually
Property acquired through a trust during the marriage may also be considered marital property if it was used to benefit one or both spouses individually. For example, if a trust funded one spouse’s education expenses during the marriage, the resulting education could be regarded as a marital asset subject to division in a divorce.
Conclusion
Divorces can become complicated, particularly when trusts and the property acquired through them are involved. While property acquired through a trust during the marriage is generally considered separate and not subject to division, exceptions do exist. If you are currently undergoing a divorce and have concerns regarding the treatment of property acquired through a trust, it is crucial to seek guidance from an experienced New Hampshire divorce attorney. Their expertise can provide valuable insights and help safeguard your interests throughout the process.