Equitable distribution of marital property in Virginia

Division of marital assets in Virginia is called equitable distribution. The trial court is required to consider ten factors before deciding how to divide assets and debts, but it is typically close to or at a 50-50 division unless there are extenuating circumstances. Fair is not always equal in Virginia. Each case must be evaluated on its own facts. Did you put separate money into a marital asset? Did you inherit property or money? Did you help pay your spouse’s separate debts? Did you personally improve property? Did you gift or deed your spouse real estate or did they do so to you? Did your spouse spend marital money on a lover? All of these issues can have a significant impact on the equitable division of assets in a divorce. Some assets are marital, others are separate while still others are hybrid: part marital and part separate.

If one party has invested separate funds in a marital asset and can trace that investment, the property may be a “hybrid” property, part marital and part separate. The investing party is entitled to reclaim their separate investment if they can prove it, plus appreciation on it, if any, unless the other party can prove, by clear and convincing evidence, that it was a gift to them.

The court is required to decide which property is marital, separate, or hybrid. Separate property belongs to the person who owns it, and the other spouse receives no interest in that property. Separate property includes property owned before the marriage, property inherited by or given to only one spouse during the marriage, and assets acquired with money earned after the parties’ separation. Assets acquired during the marriage are marital even if they are only in one spouse’s name like a pension or retirement account. If one spouse invests personal effort or marital funds into the separate property of the other, the property may also become hybrid depending on the circumstances.

 If part of the pension or retirement account was earned before the marriage, it becomes hybrid property, part separate and part marital. Debts acquired during the marriage are also marital even if they are only in one spouse’s name.

division of marital debt in Virginia

Virginia Code 20-107.3 which distinguishes separate and marital property and provides the rules that the court uses to divide up marital property between spouses was recently changed to include rules about debts. Before the change, there was no provision distinguishing “separate” and “marital” debt or instructing the court how to divide them. Some courts routinely divided debts 50-50 while others divided them more in proportion to the parties’ relative incomes. Now the Court must sort out the debts according to the reason they were incurred (marital purpose or separate one). Even student loans can be considered marital if they were incurred for a “marital purpose” like increasing one spouse’s earning ability. The law was changed in response to rulings by the Court of Appeals regarding division of marital debt.