Marital Property: When Does the Clock Stop?
A frequently asked question in cases of divorce is; what has to be divided with my spouse? The general rule is that property acquired after the ceremony and before the filing of a summons is marital property. The general exceptions are property from an inheritance, a gift from someone other than your spouse, or the result of a personal injury recovery.
A common follow-up question concerns income or property that comes into a spouse’s possession after the filing of a divorce action, but before the matter is finalized. Examples of such are employer paid bonuses, stock dividends, interest payments, income tax refunds, mortgage escrow overage refunds and the like. A general rubric for determining the marital or non-marital nature of such payments is: Does it relate back to a marital asset, or to a time period during the marriage? An example would be an employer paid bonus received in the first quarter of the year. If it relates to job service during the prior calendar year, all or a portion may be marital property. If an action is commenced June 30th and a bonus is paid the following March for the prior calendar year, it could be argued that one half of the bonus is marital property. The same analysis can well apply to escrow refunds and income tax refunds. In the case of stock dividends, if the share of stock are marital property, the dividends are as well. This applies as well to interest on savings accounts, bond interest or other distributions from investments.
Another common query: do I have to share my income with my spouse now that a divorce action has started? The courts make a careful distinction between income to be considered for support purposes (child or spousal support) and property. Once any support obligation has been assessed and met, the balance of a person’s income is theirs to do with as they please. If they save it, it is separate property to which the other spouse has no claim.
If you find yourself consulting with a matrimonial attorney, these can be critical issues. Make sure you ask the proper questions and provide your attorney with the information necessary to get accurate advice.