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Marital property versus separate property. What’s the difference?

On Behalf of | Sep 30, 2022 | Divorce

One of the issues to be resolved in a divorce in New Jersey is how to divide the assets and debts. This often involves dealing with a home, bank accounts, retirement accounts and credit card debt. Many people who are just beginning the divorce process have questions about how these things are divided. Who gets what? What has to be sold? The questions are even more difficult when thinking about valuable items of property, such as collectibles, or family heirlooms whose value is significant but cannot be reduced to a number.

The beginning of any decision about what happens with property is whether it is “subject to distribution,” which is the legal term for whether it is considered marital property. What is yours and what is shared?

Marital property

In simplest terms, marital property is property that was acquired during the marriage. Although each family is unique, common types of marital property include:

  • Primary residence
  • Vehicles, including recreational vehicles
  • Retirement accounts
  • Bank account, stocks or bonds

If these things were purchased during the marriage, or an account increased in value during the marriage, it can be considered marital property. This is true even if it is only in one spouse’s name. During the divorce, each spouse is required to disclose what property, accounts and debts they have. There then has to be a determination about what is considered marital property, followed by discussion and negotiation about a fair way to split it up.

Separate property

Separate property, on the other hand, is property or assets that are considered exempt under the law. Most often, something is exempt because one spouse owned it before the marriage. When it comes to accounts, such as investments, a portion of the value may be considered separate property and a portion considered marital property to be divided in the divorce. Money or items received as an inheritance or a gift to one spouse from a family member can also be considered separate property, even if it was received during the marriage.

A legal advocate

While it is sometimes easy to differentiate between marital and separate property, it is not unusual for the lines to be blurred.  Money that may have been separate, for example, may have been put into a joint account. It may also be difficult to prove how much was in an investment account before the marriage. Having a knowledgeable family law attorney to advocate for you is important whether you are the spouse trying to protect what you believe is rightfully yours, or the spouse being excluded from what should rightfully be shared.


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