Marital property is divided equally in Kentucky, but that poses unique challenges for couples with complex or high-value assets. Identifying these warning signs early on can be critical to successfully navigate property division challenges.
1. You sold the family farm
Separate property can lose its separate status if it is mixed or commingled with marital property. So if you sold your pre-marital home to buy the home you now share with your spouse, or if you deposited your inheritance into a joint bank account with your spouse, that property can be considered a gift to the marriage.
2. You own a business
Even if the business is not considered a marital asset, any increase in its value during the marriage may be divisible in the event of a divorce. It’s important to work with a valuation expert to determine what the property is worth and how much is has appreciated during the marriage.
3. Your spouse keeps secrets
Sometimes a spouse will not disclose or will misrepresent important information about assets or liabilities. For equitable property division, it’s important that both spouses have a clear understanding of what is owned, what is owed and a general idea of the monthly expenses.
4. You don’t already have protection
The best protections for non-marital assets are put in place long before a divorce. A prenuptial agreement can give spouses peace of mind and future financial security when signed before marriage. An irrevocable trust can also protect your assets in the event of a divorce.
5. Your spouse was the breadwinner
Some couples mix their property unintentionally. For example, one spouse may open a bank account prior to marriage. However, if both spouses make deposits to the account, it will likely be considered marital property in the event of divorce. In the same vein, if one spouse owns a home prior to marriage, it will probably be considered marital property if both spouses pay the mortgage. It can be challenging to divide property fairly in those cases.
Couples facing a complex divorce may be eager to get the divorce out of the way so that they can move on with their lives. However, making quick decisions to get the divorce over with can have serious financial repercussions. As tempting as it might be, avoid rushing through the planning and take time to with your best interest in mind.