The process of divorce is often challenging and emotionally charged, with property division being a particularly contentious issue. Within Wisconsin, spouses have two methods of dividing marital property: equitable distribution and community property. Understanding the distinctions between these methods can aid spouses in making informed decisions regarding property division.
Equitable Distribution: Complexity Meets Fairness
In Wisconsin, the majority of divorces adhere to the principle of equitable distribution. This means that marital property, which encompasses assets acquired during the marriage, is divided fairly and justly between spouses, without necessarily being divided equally. Non-marital property, including property gained prior to the marriage or through inheritance or gifts, is typically exempt from division.
Unpacking the Factors in Equitable Distribution
Wisconsin courts consider various factors when determining the fair and just division of marital property. These factors may include:
- The duration of the marriage
- Each spouse’s contribution to acquiring or preserving marital property
- The earning capacity and financial resources of each spouse
- The age and health of each spouse
- The need for one spouse to retain the marital home for the betterment of any children
- Any additional factors deemed relevant by the court
The Inner Workings of Equitable Distribution
Within the framework of equitable distribution, the court begins by classifying assets as either marital or non-marital property. Once the identification of all marital property is complete, the court then proceeds to divide it in a just and fair manner. This division may entail the equal distribution of assets between spouses, but it can also involve granting one spouse a larger portion if deemed necessary for a fair outcome.
Community Property: Equality Reigns
Wisconsin stands among a select few states that recognize community property. According to community property law, all property acquired during a marriage is equally owned by both spouses, regardless of who initially acquired it. This means that spouses are entitled to an equal share of all marital property, including income, wages, or assets accumulated throughout the marriage.
Navigating the Territory of Community Property
Under the jurisdiction of community property law, each spouse possesses a fifty percent interest in all marital property. When a divorce arises, the marital property is divided equally, with each spouse receiving a fifty percent share. Non-marital property, such as assets gained before the marriage or via inheritance or gifts, remains untouched during division.
Weighing the Pros and Cons: Equitable Distribution vs. Community Property
Both equitable distribution and community property present advantages and disadvantages, with the ideal method varying based on individual circumstances.
Benefits of Equitable Distribution
- Flexibility at its core: Equitable distribution grants the court the flexibility to divide property in a manner that is fair and just, rather than rigidly adhering to an equal division.
- Consideration of individual circumstances: In equitable distribution, the court takes into account the specific circumstances of each spouse, including their financial resources and earning capacity.
- Tailored outcomes: Equitable distribution allows for outcomes that are tailored to the needs of each spouse and any children involved.
Drawbacks of Equitable Distribution
- Subjectivity lingers: As equitable distribution hinges on the court’s discretion to decide what is fair and just, subjectivity may influence the outcome.
- Potential for higher costs: Due to the complex analysis involved in equitable distribution, litigation costs may be higher.
- Time-consuming process: With equitable distribution, the intricate analysis can prolong the resolution process in comparison to community property cases.
Advantages of Community Property
- Simplified understanding: The concept of community property is straightforward, with all marital property being divided equally between spouses.
- Expedited resolution: As community property cases do not necessitate an in-depth analysis of each spouse’s circumstances, they can often reach resolution swiftly and with minimal litigation.
- Encouragement of financial partnership: Community property law promotes a perspective in which spouses view their finances as a partnership, with equal contributions throughout the marriage.
Drawbacks of Community Property
- Potential for unfair outcomes: Community property law mandates that all marital property be divided equally, irrespective of individual circumstances. This can occasionally result in unjust outcomes.
- Loss of control: With community property, spouses have less control over the division of their assets in a divorce, as the court is required to distribute all marital property equally.
Selecting the Path to Property Division
Since every divorce is unique, there is no universally applicable approach to property division. Spouses capable of collaborating to reach an acceptable agreement may find either equitable distribution or community property suitable for their situation. However, in certain cases, litigation may be necessary to determine a fair and just division of marital property.
Ultimately, couples should partner with experienced family law attorneys to ascertain the approach to property division that best matches their individual circumstances.