Common Mistakes People Make During Property Division

Divorce can be difficult, with one of the most contentious aspects being property division. If you are going through a Florida divorce, it is crucial to understand how property is divided and the common mistakes that can cost you. In this article, we share some of the most common mistakes people going through divorce in Florida make during property division.

Mistake #1: Not Understanding the Equitable Distribution Law

One of the biggest mistakes divorcing spouses make during property division is failing to understand Florida’s equitable distribution law. In Florida, marital property (property acquired during marriage) is divided between the spouses fairly, which does not necessarily mean equally. Separate property, on the other hand, which is anything that was acquired before marriage, remains the property of the original owner. Marital property is divided based on each party’s needs, financial situation, and contributions. Failing to understand that marital assets will not necessarily be split 50/50 can result in unrealistic expectations and disagreements.

Mistake #2: Hiding or Overlooking Hidden Assets

Hiding assets or not disclosing everything you own is another big mistake to avoid during property division. You need to be honest about your financial situation to ensure a fair division. Apart from resulting in an unfair division, hiding assets or lying can ruin your credibility and result in serious legal consequences, including a less favorable ruling. If the court finds out that you attempted to hide assets, it can award your spouse more share of the marital property. Similarly, you should not overlook hidden assets. It is crucial that you are thorough in identifying all assets during the divorce process.

Mistake #3: Neglecting Debts

In a Florida divorce, property division involves more than just dividing assets. Marital debts, such as loans and credit card balances, must also be divided. Not addressing joint debts obligations can result in complications in the future. For example, you may end being responsible for debts that you incurred with your spouse during marriage. If this happens, it might cause you financial stress. It is vital to clearly identify and assign all debts during the divorce process to avoid unexpected liabilities and protect your financial future.

Mistake #4: Ignoring Some Assets (Intangible Assets)

During the divorce process, many couples focus on tangible assets such as cars, houses, and bank accounts. However, intangible assets like intellectual property and digital assets are also valuable and may be marital property subject to equitable distribution. It is vital to account for all assets to ensure a fair division.

Mistake #5: Failing To Consider Tax Consequences

Another huge mistake people make during the property division process is failing to consider the tax implications of some assets. While marital assets aren’t taxed when they are transferred between spouses, assets such as retirement accounts, real estate, and business may have future tax implications, such as capital gains tax and income tax. A financial advisor can help you make informed decisions that reduce tax liabilities.

Contact an Orlando Divorce Lawyer

If you are going through a Florida divorce and have concerns about property division, contact our Orlando divorce lawyers at The Arwani Law Firm for legal guidance.

Source:

flsenate.gov/Laws/Statutes/2018/61.075