Property & Asset Division in Tennessee
Protecting your financial security during a divorce in Maryville, Blount County and East Tennessee
During a divorce, especially if you and your spouse have been married for a while, the division of property and assets can be a complicated process. It can be even more complicated if you and your spouse are in dispute over certain assets. Most couples accumulate quite a bit of property over the course of a marriage, including a family home, vacation home, vehicles, retirement accounts, valuables, and even beloved animals, like the family dog or your horse.
However, when a marriage ends and both people go their separate ways, how are all these assets divided? And what about debts? In some cases, like in an amicable uncontested divorce, couples can work out property division on their own. However, in other circumstances for whatever reason, divorcing spouses just cannot resolve their property division disputes, or their asset division issues are simply too complex to handle alone.
The Maryville divorce and family law attorneys at Shepherd & Long, P.C. can help. With four decades of combined experience and a thorough knowledge of Tennessee property division laws, we work to ensure that you walk out of your divorce feeling financially secure and ready to take on the future.
How does property and asset division work in Tennessee?
In most divorces, if spouses can’t agree on division of assets, they can work via their divorce attorneys to resolve their issues fairly and equitably. If they still can’t agree, the next move is litigation, where a judge makes the decision instead. Tennessee Code 36-4-121 provides for equitable division of marital property, and if any fault was assigned in the divorce, that fault cannot affect property division. Once a judge makes a decision on property and asset division, or you and your partner decide between yourselves, that settlement goes into your divorce agreement and becomes legally binding.
Is Tennessee a 50/50 divorce state?
No. Only nine states follow 50/50 (also called community property) laws concerning asset division. Those states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin.
Tennessee is an equitable distribution state, which means property and assets are divided fairly and reasonably, which is not always 50/50. With equitable distribution, each spouse’s property is divided into two categories: separate and marital. The separate property of each spouse is just that – separate and untouchable by the other. Marital property is subject to division.
The Maryville property and asset division attorneys at Shepherd & Long can help you ensure what’s yours is yours, and that the rest is split up in a fair and proper manner.
What’s considered marital property in TN?
Tennessee law counts marital property as any assets and debts acquired by both spouses during the marriage and up to the date that the divorce is finalized. A judge can make an exception to this rule if you and your spouse are legally separating, in which case division of property ends at the date of legal separation instead.
Some examples of marital property include:
- Furnishings, art, and electronics
- Joint savings and earnings
- Real estate
- Retirement accounts, IRAs, and stocks
- Vehicles and boats
It’s also worth noting that marital property also includes debt, which should be distributed equitably between the spouses.
What’s considered separate property in TN?
Separate property is just about everything you brought into the marriage – anything that you had before you got married, as well as a few other things. Separate property in Tennessee can also include:
· Inheritances and family heirlooms
· Gifts received from a spouse or family (like a car or jewelry)
· Awards from personal injury or criminal victim compensation funds
· Property assigned to one spouse following a legal separation
Sometimes a judge may determine what was once separate property was “commingled” during the marriage, so it’s now marital property. An example of commingling might be that your spouse brought a house into the marriage, but you used marital income to improve the house, therefore raising the value of the house. If the judge decides the asset (the house) was commingled, it becomes marital property and eligible for distribution.
Our Maryville divorce attorneys can provide more clarity about commingling of assets.
What factors are considered by the court when determining asset division?
Here in Maryville and throughout Tennessee, the court’s goal is always to divide property and assets in a fair, equitable, and reasonable manner. To do this, they use a variety of factors as well as their own discretion. As your attorneys, our job is to ensure a successful outcome for you and your children. Tennessee Code 36-4-121 provides for the following factors when determining property division:
- Age of each spouse
- Contribution of each spouse to the marriage, including as homemaker, parent, or wage earner
- Economic circumstances of each spouse at the time of divorce or separation
- Length of the marriage
- Needs of each spouse and opportunity for each spouse to bring in income or capital in the future
- Present and future earning capacity of each spouse
- Tangible and intangible contributions made by one spouse to the other’s education, training, or increased earning power
- Tax consequences for division of property
- Value of each spouse’s property at time of the marriage and at present time
- Vocational skills and employability of each spouse
- Social Security benefits, if any
- Other factors necessary to provide equity between spouses
As you can see, asset division can be a complicated process and one best handled by an experienced divorce attorney or mediator. Talk to Shepherd & Long to find out how we can provide you informed guidance.
How is marital debt divided in a divorce in Maryville?
Because Tennessee’s property division laws have no guidance for debt, dividing that debt can become a point of contention during a divorce. However, a 2003 Tennessee Supreme Court ruling provides some clarity. The case Alford v. Alford determined that, if possible, the court should assign the debt to the spouse who benefited from or received the asset from the incurred debt. They should assign the debt using the following factors:
- The purpose of the debt
- Which spouse incurred the debt
- Which spouse benefited from incurring the debt
- Which spouse is best able to repay the debt
Remember, any debts acquired prior to the marriage are considered separate, not marital, debt and you are not responsible for those. One of the better ways to avoid lengthy disputes over asset division is to set up a prenuptial or postnuptial agreement that lays out the terms of your separate and marital property in detail. Our attorneys can explain more.
Contact an experienced Maryville property division lawyer today
The property and asset division attorneys at Shepherd & Long, P.C. work to make your divorce easier and less stressful. When you and your spouse are at odds about how to divide up your belongings in a divorce, we can help work toward a successful and equitable outcome. For more information, or to schedule a consultation, call us at 865-982-8060 or fill out our contact form. We regularly represent clients in Madisonville, Oak Ridge, Lenoir City and throughout East Tennessee.