What Constitutes Marital Property
Division of marital assets is one of the immediate concerns of spouses who are preparing to file for divorce. Pennsylvania is an equitable distribution state, which means that a court will determine a fair division of marital property. Fair and equitable does not necessarily have to be an equal 50-50 split.
Equitable distribution can become very complex, and courts have to evaluate a number of factors when arriving at decisions. Courts only engage in equitable distribution when divorcing couples are unable to negotiate property settlements.
Chester County Divorce Attorney PA Discusses What Constitutes Marital Property
Are you concerned about how your marital property will be divided in your divorce in southeastern Pennsylvania? You will want to contact Ciccarelli Law Offices for help achieve the most favorable outcome to your situation.
Call (610) 692-8700 or send an online message for a free consultation so we can act as soon as possible. We are based in West Chester PA and serve clients throughout Chester County, Lancaster County and suburban Philadelphia including West Chester, Kennett Square, Oxford, Avondale, Landenberg, West Grove, Paoli, Malvern, Downingtown, Coatesville, Exton, Parkesburg, Berwyn and Devon. We have convenient meeting locations in Lancaster, Philadelphia, Plymouth Meeting, Kennett Square, Malvern, Springfield, King of Prussia, and Radnor. Our family lawyers serve those with immediate legal needs in Chester County, Montgomery County, Delaware County and Lancaster County.
Overview of What Constitutes Marital Property in Chester County
- What is the difference between marital property and nonmarital property?
- Are retirement accounts considered marital property?
- Where can I find more information about what constitutes marital property in West Chester?
Pennsylvania Consolidated Statute § 3501(a) defines marital property as “all property acquired by either party during the marriage and the increase in value of any nonmarital property acquired pursuant to paragraphs (1) and (3) as measured and determined under” Pennsylvania Consolidated Statute § 3501(a.1). The statute notes that marital property does not include:
- Property acquired prior to marriage or property acquired in exchange for property acquired prior to the marriage.
- Property excluded by valid agreement of the parties entered into before, during or after the marriage.
- Property acquired by gift, except between spouses, bequest, devise or descent or property acquired in exchange for such property.
- Property acquired after final separation until the date of divorce, except for property acquired in exchange for marital assets.
- Property which a party has sold, granted, conveyed or otherwise disposed of in good faith and for value prior to the date of final separation.
- Veterans’ benefits exempt from attachment, levy or seizure, except for those benefits received where the veteran has waived a portion of his military retirement pay in order to receive veterans’ compensation.
- Property to the extent to which the property has been mortgaged or otherwise encumbered in good faith for value prior to the date of final separation.
- Any payment received as a result of an award or settlement for any cause of action or claim which accrued prior to the marriage or after the date of final separation regardless of when the payment was received.
Under Pennsylvania Consolidated Statute § 3501(a.1), the increase in value of any nonmarital property acquired pursuant to subsection (a)(1) and (3) will be measured from the date of marriage or later acquisition date to either the date of final separation or the date as close to the hearing on equitable distribution as possible, whichever date results in a lesser increase.
Any decrease in value of the nonmarital property of a party is offset against any increase in value of the nonmarital property of that party.
A decrease in value of the nonmarital property of a party cannot be offset against any increase in value of the nonmarital property of the other party or against any other marital property subject to equitable division.
Retirement accounts in Pennsylvania are generally divided into two groups:
- Defined Contribution Retirement Plans — 401(k) plans, 403(b) plans, employee stock ownership plans, and profit-sharing plans are all examples of defined contribution retirement plans in which workers contribute to accounts for which values will fluctuate but can generally be clearly defined.
- Defined Benefit Retirement Plans — More commonly known as pensions, defined benefit plans are funded by employers that promise specified monthly benefits at retirement and can be more complicated to value.
When a spouse has a retirement account, he or she must determine whether the account was created before, during, or after the marriage. Retirement plans created before the marriage are both marital property and nonmarital property, with any increase in value during the marriage becoming marital property. Retirement plans created during the marriage are marital property, while retirement plans created after the marriage are nonmarital property.
Calculating the value of these plans may require the assistance of an expert. Defined benefit plans or pensions may require actuaries to use formulas that incorporate numerous factors into determining value, while defined contribution plans can require records of post-separation contributions.
Chapter 35 Property Rights | Title 23 | PA General Assembly — Title 23, Chapter 35 of the Pennsylvania Consolidated Statutes covers property rights. Learn more about equitable division of marital property, effect of divorce on property rights generally, and disposition of property after termination of marriage. You can also read statutes relating to disposition of property to defeat obligations, statement of reasons for distribution, and division of entireties property between divorced persons.
Ciccarelli Law Offices | West Chester Divorce Lawyer
If you are filing for divorce in southeastern Pennsylvania and have concerns about marital property, it is in your best interest to make sure that you retain legal counsel. Ciccarelli Law Offices represents individuals in communities all over Montgomery County, Chester County, Delaware County, Lancaster County, and the greater Philadelphia area.
Our divorce attorneys in West Chester understand how complicated dividing marital property can be, which is why we work to reduce the stress it places on our clients.
You can have our lawyer provide a complete evaluation of your case when you call (610) 692-8700 or submit an online contact form to receive a free initial consultation.