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What Is Equitable Distribution in Divorce?

When it comes to dividing property and debt in a divorce, states either follow community property division or equitable distribution. North Carolina is an equitable distribution state, meaning a judge will divide property in a divorce according to what it considers fair to each spouse. Today, we review how equitable distribution works and what you need to know about property division in North Carolina.

Equitable Distribution in North Carolina

Unlike community property states where marital property is divided 50-50, equitable distribution states divide property in a matter that is deemed fair.

While the court does start the process of property division presuming that it is fair to divide all marital property equally, this rarely happens. The courts must also consider additional factors that could impact property division determinations. It is also assumed that equal distribution may not always be fair, according to the laws in this state, which is why additional factors come into play.

Factors a Judge Will Consider Before Dividing Property

A judge will consider the following factors when dividing marital property:

• Length of the marriage

• Each spouse’s age and physical and mental health

• Each spouse’s income

• Property each spouse owned when they were single and married

• Future financial circumstances of each spouse

• If one spouse wastefully dissipated marital assets

• Need of the parent with custody of the children to live in the marital home

• If either spouse has a fair claim to marital property

• Health insurance and inheritance rights either spouse may lose because of the divorce

• Liquid or non-liquid character of all marital property

• Tax consequences of each spouse

• Whether one spouse transferred marital property in contemplation of divorce without fair consideration

• Any other factor the court deems appropriate

What Property Is Subject to Equitable Distribution?

Marital property is subject to equitable distribution, which may include but is not limited to:

  • Income earned during the duration of the marriage
  • Property purchased (including the marital home, vacation home, and investment properties)
  • Retirement benefits
  • Valuable items such as art, fine jewelry, furniture, and collectibles
  • Boats, planes, and automobiles

How Property Is Divided in a North Carolina Divorce

You can either come to an agreement with your spouse about how you would like to split your marital property or have a judge decide for you based on the factors above. Additionally, if you entered into a prenuptial or postnuptial agreement, the court would need to abide by the provisions in the agreement.

Contact our firm online or call us at (704) 343-8811 to schedule a consultation if you need assistance with your North Carolina divorce.