Money in a Joint Bank Account Is Still a Marital Asset During Separation
Any asset that would have been considered a marital asset would retain that status until a divorce is finalized. Therefore, if an item was purchased with money from a joint bank account, it would most likely be considered a marital asset. If money from an joint account was used to restore or improve a separate asset, it could become a marital asset because of a concept called commingling. When funds are commingled, it becomes difficult to determine whether an asset is truly separate anymore, which means it is likely to be labeled as a marital asset.
Was There an Agreement Regarding Items Purchased During the Separation?
It is possible for a couple to come up with an agreement regarding the status of any property that they own or acquire during the separation period. If an agreement is already in place, it will dictate whether something purchased during a separation is to be labeled as marital property or separate property.
A prenuptial agreement or postnuptial agreement may also act to change separate property to marital property or vice versa. However, such an agreement is only valid if both sides agree to terms with no undue influence or pressure placed on either party. Those who believe that they were the victim of duress prior to signing any type of agreement may want to voice those concerns to an attorney.
Certain Items Are Almost Always Separate Property
If an individual received an inheritance from a parent or grandparent, that money or property will be labeled as separate property. If an individual is gifted a home, car or proceeds from an IRA or life insurance policy from a family member, it may also be labeled as separate property.
Those who have any questions as to whether a spouse would be entitled to a portion of an inheritance or any other assets passed down from family members, it may be a good idea to consult with an attorney. It may be possible to put such assets in a trust that names the individual who received the assets as the trustee to ensure that he or she retains full control of those assets.
It May Be Best to Acquire Items With Your Own Money
As a best practice during a separation, you may want to create your own bank account and use it exclusively to acquire items before the divorce. You may also want to use a personal credit card to buy items if you don’t want to or cannot get your own bank account for any reason. Furthermore, make sure that the money that goes into the account comes from a paycheck or gifts made directly to you. This makes it less likely that your spouse can claim commingling of funds or otherwise claim a portion of property that doesn’t belong to him or her.
Determining whether property is marital or separate in nature can play a large role in how much you are actually entitled to in a divorce settlement. It can also create complications when it comes to actually creating that settlement if there are doubt about who actually owns what. Therefore, it may be a good idea to create an agreement before separating or to do so as soon as possible if a separation seems likely to evolve into a full divorce.