Concerns of how property will be divided during a divorce is a source of stress for both parties. The laws of property division vary from state to state so it is important to speak with an attorney in your home state concerning these matters. In Georgia divorce cases, property is categorized as being either separate or marital property. Separate property is the property that each spouse acquired before the marriage. Separate property typically remains separate during and after the marriage. O.C.G.A. § 19-3-9. Marital property is property that results from the efforts and earnings of both parties and is therefore, subject to equitable division at the time of divorce.
What are some examples of separate property?
Separate property is any asset that one party brings to the marriage but was acquired before the marriage. Some examples include, but are not limited to:
- trust funds
- real property (houses and land)
- personal property (antiques and other belongings)
- retirement accounts
- inheritance or gifts
Both gifts and inheritance are very likely to be considered separate property by Georgia courts if given to one party specifically, even if given during the marriage. Pursuant to Georgia case law, “property acquired during the marriage by one spouse by gift, inheritance, bequest or devise remains the separate property of the recipient spouse and is not subject to equitable division.” Armour v. Holcombe, 288 Ga. 50, 51 (2010). Gifts are made when one party receives property free and clear of expectation or consideration. Inheritance is vested to a party through a probated will or through a trust. The reason for this is courts assume the giving party clearly intends that the recipient be the only party to benefit and there is a strong desire to honor the wishes of the deceased party.
When is separate property no longer considered separate?
Issues arise when it is unclear as to whether the separate property has remained separate from marital assets. This happens when marital property and separate property is “commingled.” Commingling changes separate property into marital property. For example, when one party brings a significant trust or savings account to the marriage but after the marriage both parties begin contributing funds to the account, the account is no longer clearly separate because marital funds have been introduced into the account.
Courts will also look at other factors to determine whether seemingly separate property is truly separate. Each party’s contributions to the marriage are carefully considered by the court. When only one party works, it is mistakenly assumed that all assets are separate and belong to the wage earner. When one party works and the other party stays home for the purposes of childcare, courts still view the homemaker spouse as contributing the marital earnings. The court’s reasoning is that without the homemaker spouse to manage the home and children, the working spouse would not have as much time to devote to a career. This factor, in addition to the duration of the marriage and standard of living, will be important in deciding which property is separate and which is marital. Family courts are concerned with equitable division the goal is never to leave one party destitute while still allowing each party to retain as much separate property as possible.
How can I protect my separate property?
One option to help protect separate property is a prenuptial agreement. Prenuptial agreements are not ironclad but can be useful in establishing what is and isn’t separate property in the event of divorce. Prenuptial agreements are controversial and have been the cause of many a broken engagement. This is a subject to be carefully considered with the guidance of an attorney.
Another helpful remedy is to keep detailed and consistent financial records. A clear paper trail is helpful in establishing which funds are separate and which are marital. Avoid commingling of funds in any account acquired before a marriage. New joint accounts should be opened upon the marriage, rather than adding one party to a preexisting account.
If the concern is retaining separate property for the purpose of keeping it in the family, an experienced divorce attorney can assist by setting up a trust for the intended heirs. This should be done prior to the marriage in order to ensure the property remains separate.
The best way to protect separate property is to speak with an attorney prior to the marriage. When both parties are represented by their own attorney the outcome is likely to be more favorable and less stressful for everyone. More importantly, in the event that a divorce arises, courts are more likely to enforce any premarital agreements when it feels both parties were adequately represented and well informed. This process sounds counterintuitive to the romance of engagement but in the long term, preemptive planning avoids stress and costly litigation for not only the parties but also for their families.
If you are facing property and asset issues in a divorce, call us at 770-609-1247 to speak with one of our attorneys about how we can assist you.