What is 'Equitable Division'

Equitable division is a legal theory guiding how property acquired during the course of a marriage should be distributed between the two parties in the case of a divorce. Equitable division takes into account a variety of factors when dividing assets and debts, including how long the parties were married, the needs of each of the parties and the financial contribution each party made during the marriage.

BREAKING DOWN 'Equitable Division'

Dividing up property during divorce proceedings is often a complicated endeavor, and different legal theories treat this division differently. Community property theory holds that property should be divided equally, since both parties are considered to have joint ownership of all property (both assets and debts). Equitable division theory differs from this approach substantially.

How Equitable Division Works

Rather than treat each party as equal, equitable division holds that a variety of factors make the ownership of property inherently unequal. Factors that make the parties unequal include educational attainment and employability, how much each party earns and spends, what the financial needs of each party are, and the age and health of each party. The theory also takes into account the causes of the divorce, including whether one party was abusive or unfaithful.

Property is often divided into two groups. The first group is separate property, which is property that belongs to one spouse. Examples include property acquired before the marriage or inherited before or during the marriage. Some states allow separate property to be excluded from equitable division. The other group, marital property, represents property acquired during the marriage.

Most states follow equitable division theory during divorce proceedings. Only Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin are community property states, and Alaska allows the couple to decide whether they want their property to be community property.

Property division does not have to be decided by a third party, and if a couple can decide how to split up their assets and debts, they do not have to follow either property division rule. However, if the parties in a divorce cannot agree on how to divide their property on their own or during arbitration, the divorce may go to court, with a judge ultimately deciding who gets what based on the laws of their state. The division of property during a divorce is not a physical division, meaning one person gets the house and the other person gets the cars and the boat; instead, each spouse will receive a percentage of the assets and debts.

  1. Community Property

    Community property is a state-level legal distinction of a married ...
  2. Common Law Property

    Common law property is a system that most states use to determine ...
  3. Equitable Subrogation

    Equitable subrogation is a legal principle allowing a party that ...
  4. Joint Owned Property

    Joint property is any property held in the name of two or more ...
  5. Certified Divorce Financial Analyst ...

    A Certified Divorce Financial Analyst uses their knowledge of ...
  6. Personal Property

    Personal property is a type of property which can include any ...
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