Tennessee is one of many states in the nation that uses an equitable distribution method of dividing marital property. Equitable distribution is dividing property in a manner that the court determines to be fair, although it may not necessarily be equal.
Courts do not always have to enter into property division cases, as some couples may be able to agree to terms of property division without any court oversight. In many cases, however, spouses may have disagreements over who gets to keep what.
Arguments about how property gets divided only add to the stress of divorce proceedings. In some cases, property division may be the most significant issue that slows down a divorce proceeding.
Are you struggling to finalize property division with your spouse as part of your divorce in Memphis? Don’t allow yourself to be taken advantage of, and instead, hire a lawyer to represent your best interests and help make sure that you retain the property that is most important to you.
Shannon A. Jones, Attorney at Law will stand up for you to protect your rights and make sure that you receive a truly equitable division of your marital property. You can have our lawyer answer all of your legal questions as soon as you call (901) 390-9041 or contact us online to set up a free consultation.
Tennessee Code § 36-4-121(a)(2) establishes the court can equitably distribute, assign, or divide the marital property in whole or in part. The court can also divide marital property at a later time.
Under Tennessee Code § 36-4-121(b)(1)(A), marital property is defined as:
All real and personal property (both tangible and intangible)
Acquired by either or both spouses during the course of the marriage (up to the date of the final divorce hearing)
Owned by either or both spouses as of the date of the divorce filing (except in the case of fraudulent conveyance in anticipation of filing)
Includes any property that was acquired up to the date of the final divorce hearing
Valued as of a date reasonably near the final divorce hearing date.
Marital property is identified in Tennessee Code § 36-4-121(b)(1)(B) as including:
Income and any increase in value from property determined to be separate property
The value of pension benefits, stock option rights, retirement, and other fringe benefit rights accrued because of employment during the marriage
The account balance
Other value of pension benefits (vested or unvested), stock option rights, retirement, and other fringe benefits
Any withdrawals from those assets used to acquire separate assets.
Tennessee Code § 36-4-121(b)(1)(C) provides that marital property also includes recovery in workers’ compensation, personal injury, social security disability actions, and other actions for wages lost during the marriage, reimbursement for medical bills, and property damage to marital property.
Under Tennessee Code § 36-4-121(b)(2), separate property is defined as:
All real and personal property owned by a spouse before marriage (including assets held in individual retirement accounts [IRAs])
Property acquired in exchange for property acquired before the marriage
Income from property owned by a spouse before marriage (this includes appreciation)
Property acquired by gift, bequest, devise or descent
Victim of crime compensation awards, pain and suffering awards, future medical expenses, and future lost wages
Property acquired after an order of legal separation in which the court made a final disposition of property
Tennessee Code § 36-4-121(c) states that a court must consider all relevant factors when making an equitable division of marital property, including:
Physical and mental health, age, vocational skills, employability, earning capacity, estate, financial liabilities and financial needs of each spouse
Tangible or intangible contributions made by one spouse to the other’s education or training that increased the earning power of the other spouse
The relative ability of each spouse to make future acquisitions of capital assets and income
Contribution of each spouse to the acquisition, preservation, appreciation, depreciation or dissipation of the marital or separate property
Value of each spouse’s separate property
Each spouse’s estate at the time of the marriage
The economic circumstances of each spouse when the division of property becomes effective
Tax consequences for each spouse, costs associated with the sale of an asset, and other reasonably foreseeable expenses associated with an asset
When valuing a closely held business (or similar asset), the court will examine all relevant evidence (including standard valuation methods) without considering if the sale of the asset is foreseeable
Social Security benefits available to each spouse
All other factors necessary to consider the equities between the spouses
Under Tennessee Code § 36-4-121(d), a court can award the family home or the right to live in the home to either spouse. The court must give special consideration to a spouse having physical custody of a child or children.
In most cases, spouses will identify the value of their assets, and the financial value of certain items can be easily determined for considerations such as bank accounts. Other types of assets may be subject to some dispute, and an independent appraisal may be required on certain objects for which the value cannot be proven with receipts or other evidence.
In Alford v. Alford, 120 S.W.3d 811, 814 (Tenn. 2003), the Supreme Court of Tennessee wrote that trial courts should consider four factors when allocating marital debts:
The purpose for incurring the debt
Which party incurred the debt
Which party benefited from incurring the debt
Which party will be most able to repay the debt
In general, debts that were incurred before or after the marriage will not be divided. A court could assign a debt to the spouse who received a particular asset. You will want a lawyer to review all of your joint debt considerations because certain types of debt in the names of both spouses can make both parties liable for non-payments even when one spouse is responsible for making payments.
The Supreme Court of Tennessee noted in Langschmidt v. Langschmidt, 81 S.W.3d 741, 747 (Tenn. 2002) that had not addressed commingling and transmutation, but several opinions of the Court of Appeals had explained the concepts as follows:
Separate property becomes marital property by commingling when it is inextricably mingled with marital property or with the separate property of the other spouse, but commingling does not occur when the separate property continues to be segregated or can be traced into its product. Transmutation happens when separate property is treated in such a way as to give evidence of an intention that it becomes marital property.
If you are in the midst of a dispute about property division relating to your divorce in Memphis or a surrounding area of Tennessee, you do not want to waste any more of your time arguing with your spouse. Get yourself a skilled lawyer who can help finalize the terms of your property division and help keep all of the items most important to you.
Shannon A. Jones, Attorney at Law represents clients throughout the greater Memphis area. Call (901) 390-9041 or contact us online to take advantage of a free consultation.