How do I know which assets are separate property?

On Behalf of | Apr 12, 2021 | Family Law |

Dividing property in a divorce can be quite a complex matter. It is difficult for spouses to determine a fair agreement, especially when they consider the financial values and emotional attachments to many of these assets.

North Carolina law requires spouses to divide marital property in a divorce, but a spouse’s separate property is not subject to division. This leads many spouses to wonder: what does separate property include then?

Which assets are separate property?

Separate property includes:

  • Gifts given to one spouse specifically
  • Bank accounts or inheritances held separately
  • Property a spouse owned before the marriage
  • Assets a spouse obtained after the separation
  • Property obtained and owned solely by one spouse and not used by the other

It is critical to note that individuals generally must prove that an asset is separate property. For example, it might be necessary to show documentation that the property is in one spouse’s name.

However, spouses should not assume that an asset is separate property. Even if it falls in the categories listed above, it does not automatically mean an asset is separate property.

Look closely – separate property may have become marital property

An asset that would normally be defined as separate property could actually become marital property.

Take real estate, for example. If one spouse owned it before the marriage, it is separate property. But if one or both spouses contribute marital finances to update or maintain the property, it is now marital property. This can make the property division process even more complex.

This is why individuals should always carefully evaluate their assets during the property division process. Then they can determine how they can approach this efficiently and protect their assets and future after the divorce.