What Is Equitable Distribution?

Personal Injury Lawyer

“Equitable distribution” is a legal term that comes into play when you get a divorce. What it means is that the property settlement you and your soon-to-be former spouse agree to must treat both of you fairly and impartially. Most states require this kind of a property settlement agreement.

If you live in one of the following states, however, equitable distribution is not an issue:

  • Arizona
  • California
  • Idaho
  • Louisiana
  • Nevada
  • New Mexico
  • Texas
  • Washington
  • Wisconsin

These states are community property states, meaning that all marital property must be divided equally between spouses during a divorce. If you live in Alaska, you have the option of designating your marital property as community property.

How Equitable Distribution Works

If your state requires equitable distribution, you have a great deal of leeway in how you construct your property settlement agreement. You can take many things into consideration, including the following:

  • Whether one of you incurs substantial health care and prescription drug costs due to a chronic disease or medical condition
  • Whether this medical condition prevents the affected spouse from working
  • Whether one of you earns significantly more than the other
  • Whether one of you pays child support to a former spouse or partner
  • Whether one of you has an alcohol, drug, or gambling problem that causes you to dissipate assets

In other words, your property settlement need not make anything approaching an equal distribution of your marital property in order to be fair and equitable. Your own unique situation dictates which of you gets what.

Separate Property

Keep in mind that your separate property, also called nonmarital property, plays no part in your property settlement agreement whether you live in a community property or equitable distribution state. Separate property includes such things as the following:

  • Any property you acquired or owned before your marriage
  • Any property you received as an inheritance during your marriage
  • Any property you received as a personal gift during your marriage, including gifts your spouse gave you

This property is and remains yours and yours alone.

Obtaining Legal Help

Given that constructing a fair and equitable property settlement agreement can become quite complex and complicated, you would do well to retain an experienced lawyer, like a family lawyer from Scroggins Law Group, before attempting to put one together. You definitely need the advice and counsel of a competent attorney before agreeing to any property settlement your spouse urges you to sign. Your attorney knows the laws of your particular state and can protect your rights. He or she can also advise you of the tax consequences of various property settlement provisions.