Is Everything Split 50/50 in a Divorce in North Carolina?
Is Everything Split 50/50 in a Divorce in North Carolina?
Even when a divorce is relatively amicable, property division can still be contentious. There are complex rules governing what counts as marital property, what counts as separate property, and how it all gets divided. While the division of property is supposed to be “equitable,” you and your spouse may disagree on what is equitable or fair.
On top of that, the rules can be drastically different depending on where you live. Each state has its own rules about how marital assets should be divided. While some states strictly split assets 50/50 in all cases, others (including North Carolina) do not.
In this blog post, we’ll briefly discuss the two main systems of property division used in the United States—and discuss what is used in North Carolina.
Community Property States vs. Equitable Division States
Although each state has its own specific set of rules about dividing property, they generally fall into one of two broad categories:
Nine states, located primarily in the western and southwestern United States, observe community property laws. In a community property state, all marital assets and debts are split 50/50 in the divorce. This group of states includes California, Texas, Washington, Idaho, Nevada, Arizona, New Mexico, Louisiana, and Wisconsin.
The remaining states, including North Carolina, follow the law of equitable division, also known as equitable distribution. In an equitable distribution state, marital assets are to be divided “equitably” or fairly. What is equitable or fair is generally in the discretion of the judge.
One state, Alaska, generally follows equitable distribution but also allows couples to “opt in” to a community property arrangement before or during the marriage (but not once the divorce process has begun).
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Separate Property vs. Marital Property
Before we go further, it’s important to clarify what we mean by “everything” when we ask if everything is split 50/50 after a divorce. “Everything” in this case refers to marital property.
But what exactly is “marital property”? In general, marital property refers to any assets acquired during the course of your marriage—income, property, debts, investment accounts, pension and retirement benefits, etc. It does not matter whose name the asset is in, and they are not required to be in joint names. These are the assets that are to be divided during the divorce process—50/50 in community property states, or “fairly” in equitable distribution states.
By contrast, separate property refers to assets that one spouse owned before the marriage, or gifts or inheritances given specifically to one spouse and not the other during the marriage. These do not get divided.
However, in practice the line isn’t always quite so clear. For example, in North Carolina, all assets owned by a party on the date of separation are considered marital property by default (the “presumption” of marital property). If one spouse contends that certain assets should be considered separate property, that spouse must have evidence to overcome the presumption. Furthermore, assets that begin as separate property can become joint property if they are mixed with marital assets during the marriage.
This aspect of the law is extremely complicated, so it’s always wise to consult with an experienced property division attorney. If you’d like more information on how separate assets can become marital property, we cover this in much greater detail in a recent blog post.
Equal and Equitable Are Not (Necessarily) the Same Thing
In the context of property division, “equal” and “equitable” have very different meanings. Equal simply means both sides get the same amount. Equitable means that the division is fair for both sides.
Of course, sometimes a 50/50 split really is the fairest approach, and that’s exactly what a judge will decide. In fact, North Carolina state law instructs that marital property and divisible property should be divided equally according to their net value, “unless the court determines that an equal division is not equitable.”
But as you can imagine, there are many relevant factors that could shift the balance from strict 50/50 when it comes time to divide property equitably. Here are a few examples of what a court might consider:
- Duration of the marriage. Couples that have been married a long time, naturally, tend to accumulate a lot of joint property, and division typically becomes more complicated. By contrast, relatively short marriages typically have much less property acquired during the marriage.
- Child custody. If one spouse will be the primary caregiver for the couple’s children, they might receive the family home and a proportionally greater share of the assets to provide for their care.
- Future financial needs and earning potential. For example, say that one spouse is a high wage earner, while the other is unable to work due to chronic health issues or disability. A court may divide the property in favor of the spouse with fewer resources and greater needs.
- Contribution to career advancement. Say one spouse paid to help the other get an advanced degree—or, alternatively, quit working and stayed home to allow their spouse more time to devote to their own professional opportunities. These scenarios might lead to a more unequal distribution being considered “fair.”
- Tax considerations. If a certain division of property would pose unequal tax burdens on the parties, they may also be given a greater share of assets as compensation.
These are not the only examples. North Carolina law allows for a judge to consider several factors that the court shall take into consideration if one party requests an unequal division, but also allows for “any other factor which the court finds to be just and proper” to be considered as well. This gives the judge a wide degree of subjective authority when it comes distributing assets “equitably.”
How a Divorce Attorney Can Help
If this all seems complicated, that’s because it is. Every marriage is unique, and determining what’s “fair” is much more difficult than simply figuring out what’s “equal.”
Because what is equitable can be subjective, and there are often few easy answers, it’s normal for divorcing couples to strongly disagree about how to divide their assets—even when both sides act in good faith and aren’t actively trying to take advantage of one another. When spouses can’t agree between themselves, the matter must be resolved in court.
A divorce attorney can be a huge benefit as you and your spouse go separate ways—even if your divorce is (or at least begins as) an amicable one. An experienced lawyer will know the law, know the local courts, know how to distinguish between marital and separate property (and obtain the evidence needed to document and prove that certain assets should be considered separate), and how to accurately calculate the value the property to be divided.
Further, divorce is almost always stressful and painful even when both parties agree it’s for the best. Having an attorney handle this delicate, complicated legal work often means a faster resolution and less drama between separating spouses. You can focus on building your future life and, ideally, maintain a better relationship with your ex-spouse (especially if children are involved) while your attorney handles the legal work.
And the unfortunate reality is arguments over how the property will be divided can, and often do, lead to bitterness even in divorces that start out amicably. If your ex-spouse starts acting in bad faith or trying to get more than their fair share, a divorce attorney can help you protect your legal rights and work toward the quick, fair resolution that’s ultimately in the best interests of everyone concerned.
Myers Law Firm: Honest, Ethical, and Effective Representation
If you’re looking for an honest, compassionate, and dedicated legal team to help you resolve your property division issues after a divorce in Charlotte or Mecklenburg County, contact Myers Law Firm today for a free consultation.
Our attorneys have extensive experience handling every aspect of the property distribution process, as well as all family law matters related to divorce, separation, child custody, and child and spousal support. We are here to help you understand your options and protect your rights during stressful circumstances like this.
N.C.G.S. § 50-20
The content provided here is for informational purposes only and should not be construed as legal advice on any subject.