Married couples preparing for divorce often have questions about the process ahead. They want to start planning for the future while simultaneously pushing for a fair divorce outcome. Understanding what to expect during property division is important for strategizing prior to a divorce and rebuilding after a divorce.
As an equitable distribution state, Michigan leaves many details about litigated property division to the discretion of a judge. Spouses have the option of settling amicably outside of court. If they cannot, then a judge looks at their marital assets and decides how to divide them based on the unique circumstances of the marriage.
Some resources can remain the separate property of one spouse, which means they don’t need to be divided. What can people treat as separate property during a Michigan divorce?
Statutes and court precedents influence property decisions
The equitable distribution statute provides information for judges regarding what they should consider when dividing property. Unlike many states with equitable distribution laws, Michigan does not have a statute explicitly describing what constitutes marital property as opposed to separate property.
Instead, judges have to consider the language of multiple separate statutes and historical court rulings when deciding how to address different resources. Typically, any assets that spouses earned or purchased during the marriage are separate property.
Spouses may have to report and divide retirement savings held in the name of one spouse and investments purchased by one spouse. That being said, there are certain resources that people can potentially protect from the property division process.
Any assets directly owned by one spouse prior to marriage may remain their separate property when they divorce. Spouses can also frequently protect assets that they inherited from a loved one or received as a gift from someone other than their spouse when they divorce.
However, even assets that might be separate could be subject to claims of commingling. If one spouse invested marital property in the maintenance of separate assets or if they relied on their spouse to provide unpaid services to improve or maintain their separate property, then assets that could be separate might become marital property.
Those who hope to preserve assets as separate property when they divorce may need help reviewing financial documents and strategizing for the property division process ahead. Gathering financial records is an important first step for those hoping to assert that certain resources are separate property when they divorce.
