Property Division in Financially Complex Divorces in Connecticut
In financially complex, high-asset divorces, all money-related aspects—specifically alimony, child support, and property division—can be tricky. Property division is probably the most challenging element to consider while drafting your divorce agreement, which is why you should absolutely be in touch with an attorney who specializes in Family Law when you decide to move forward with your divorce
When considering property division in high-asset divorce cases, you will need to determine:
- Whether the property counts as an asset to divide
- How a court may value the property
- How a court may rule on dividing the property
If you have a prenuptial agreement, this can influence property division in your divorce. However, in some cases, even if a prenup exists, it may be disputable or lack clarity regarding specific property.
Divisible Property in Connecticut Divorces
The first question to consider is whether the property is divisible under Connecticut law. Generally speaking, Connecticut courts follow an “all property” division rule.
This principle states that the court has jurisdiction over all property types each spouse owns, no matter when or how it was acquired—even inheritance and gifts. Connecticut doesn’t separate marital and private property the way many other states do.
It’s essential to keep in mind that “all property” also includes debt. That means that, theoretically, one spouse can incur debt and implicate the other spouse during the divorce.
What Doesn’t Count as Divisible Property
In some cases, the courts won’t consider property as subject to division. One example is an asset that one spouse doesn’t have possession of yet because it is contingent on a future event.
For example, let’s say one spouse is the beneficiary of a relative’s will and is supposed to inherit valuable property in the future. However, the property’s current owner could change their will, so the potential inheritance isn’t something a divorce court will consider divisible property.
Property Valuation in Financially Complex Divorces
Sometimes, valuing property can be a challenge. For instance, let’s say that one of the spouses funded an irrevocable trust that owned a large and valuable house. The trust allowed the spouse to live on the trust-owned property. How, then, would a court value the trust during property division?
In this case, for property division purposes, the court will probably determine that the trust’s value equals not the value of the property but how much the spouse saved in living expenses by using the property.
Property Distribution in Connecticut
Connecticut family law courts operate on the principle of “equitable distribution” during property division. Many people mistakenly think that “equitable” means equal. In reality, it means what the family law court considers fair.
When people realize that, they are often confused because “fair” can be a vague concept that depends on many factors. These may include:
- Each spouse’s income, earning potential, and financial liabilities
- What each spouse contributed towards the asset’s acquisition, preservation, or appreciation
- The length of the marriage
- Whether the couple has dependent children
- A stay-at-home spouse’s contribution towards raising children and property maintenance during the marriage
The bottom line: Connecticut courts have a lot of authority in property division rulings, and legal counsel from a knowledgeable divorce attorney is invaluable while negotiating an agreement.
Mediation and Collaborative Divorce
Because Connecticut is not a 50/50 property division state, it is hard to predict how a family court will divide property in each divorce case. While this can complicate property division, it also gives spouses and their lawyers the possibility to craft an individualized agreement.
Disputing property division orders post-court is extremely difficult, which is why thoughtful and timely handling of all property division matters is critical. Dividing property during divorce will have a long-term impact on both parties’ financial future.
Advantages of Property Division Agreements
If the divorcing couple cannot agree on some or all aspects of property division, the matter passes to the court. By default, a judge will only have limited knowledge of the couple’s situation, so the court’s ruling may leave both parties dissatisfied.
It is always better if both parties and their divorce lawyers can reach an agreement out of court. Mediation and collaborative divorce give both spouses a lot more control, predictability, and security than a complex and drawn-out legal battle over assets. Effective communication and conflict resolution will also help you lower your legal fees.
A wise property division agreement can do more than settle present disputes. It can prevent future conflicts, ensuring peace of mind for both parties in years to come.
Get the Guidance You Need with Freed Marcroft
Freed Marcroft’s family law attorneys know that family law matters aren’t just legal issues—they are emotional processes as well. We guide select clients through the legal aspects of their family law situation while remaining mindful of their overall wellness.
To discuss how we can help with your situation, contact us today here.
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The information in this blog post (“post”) is provided for general informational purposes only, and may not reflect the current law in your jurisdiction. No information contained in this post should be construed as legal advice from the individual author or the law firm, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country or other appropriate licensing jurisdiction.
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