When determining how to divide property between spouses who are seeking a divorce or separate support and maintenance, the Family Court first distinguishes marital property from nonmarital property. Essentially, marital property is property accumulated during the marriage, with some exceptions. Gifts between spouses that are given during the marriage are usually considered marital property that is subject to division, while premarital gifts between spouses are typically not considered marital property, since they were acquired before the marriage.
The reason that the Family Court places such a great emphasis on the distinction between marital property versus nonmarital property is due to the fact that the Family Court only has the authority to apportion and divide marital property and has no authority or jurisdiction over nonmarital property. Property that was owned by a spouse prior to the marriage is deemed nonmarital property, unless it was either transmuted from nonmarital property into marital property during the marriage or a spouse acquires a “special equity” interest in nonmarital property.
Property inherited by one spouse or property given by a third-party as a gift to one spouse falls under the category of nonmarital property. Contributions to one spouse’s IRA is deemed marital property and subject to equitable distribution when contributions to the IRA came from income earned during the marriage. Retirement benefits are also typically marital assets. On the other hand, Social Security benefits and state disability retirement benefits are not subject to equitable distribution between the parties.
While the focus of discussion on property division between spouses often revolves around how assets will be divided between the parties, debts accumulated during the marriage are also considered to be marital property and are often divided between the parties under the same guidelines used to divide assets.