Property division during a Florida divorce can get complicated. Unlike community property states, Florida law mandates equitable division of marital property, meaning each spouse will get a fair share of what they acquired during the matrimony (which does not necessarily equal 50%). The court considers various circumstances that justify an unequal division of marital property.
The key to understanding property division in a Florida divorce (including bank accounts) is knowing the difference between marital and separate property. A marital property consists of assets spouses acquire during the marriage, while a separate property is a property you attain before matrimony. Only marital property is subject to equitable distribution rules.
The funds spouses keep in bank accounts can be part of a separate or marital property, regardless of whose name is on the account. Disregarding rules that deal with marital property division can lead to unnecessary delays and contentions.
To avoid the negative consequences of commingling separate property and marital assets, and ensure you keep funds in your account, below is a list of what you should and should not do when dividing bank accounts in a Florida divorce.
Maintaining a clear distinction between separate and marital property requires meticulous planning and financial discipline. Take a look at the things you should do to ensure your bank account funds remain yours after the divorce:
Before you decide to tie the knot, be sure to speak with an experienced family lawyer. Seeing things from a different perspective, a good lawyer will advise you to protect your separate property (including funds in bank accounts) from potential division in case of a divorce. Your lawyer will help you create a prenuptial agreement defining non-marital property (the assets you had before marrying) and distinguishing it from marital property.
Although having your name on a separate bank account does not mean the funds are not subject to equitable distribution, it is a good starting point for differentiating your assets from marital property. On the other hand, putting your partner’s name on a bank account will complicate efforts to prove your exclusive rights to the funds in question.
Once you decide to marry a person you love, prospects of divorce may seem unrealistic, leading you to ignore the fundamental financial discipline regarding your separate assets. To avoid unpleasant surprises, keep impeccable financial records before, during, and after the marriage. That includes bills and other financial documents about purchases, deposits, withdrawals, and other transactions from both your separate and joint accounts. In the event of divorce, you can track each transaction, tracing it back to the account from which it originated.
Since all assets you and your spouse acquire during the marriage belong to marital property, the best way to manage and track income and expenses is through a joint bank account. That is especially useful for paying recurring expenditures (a mortgage, car payments, insurance, etc.).
It is not uncommon if you want to obtain specific commodities separately (cars, expensive watches, etc.). To ensure you keep those items after divorce, use funds from separate bank accounts to buy them. Failing to do so will inevitably lead to their division since Florida law considers such goods as marital property.
Commingling funds from separate and joint bank accounts results in treating the individual property as marital property during the divorce. The court will divide them equally unless specific circumstances justify an unequal division. To prevent commingling, ensure you avoid these mistakes:
Utilizing funds from your separate bank account to pay off marital debt will transform your funds into marital property. In other words, if you use the money you received as a gift or inheritance to pay the joint debt (credit card debt, mortgage, car payment, etc.), the commingling will occur, and the funds will become part of the marital property.
Similarly, if you receive money earned during the marriage and deposit it in your separate bank account, the funds become marital property subject to equitable distribution rules. In this scenario, having an individual account with your name on it will not change the fact that the funds are commingled by receiving deposits from marital property.
Joint bank accounts hold funds that belong to marital property. Utilizing these accounts, spouses service regular payments and household expenses. Both spouses have access, and the funds belong to them equally. Nevertheless, do not withdraw all of the money unilaterally in the case of divorce. It will unnecessarily complicate matters when dividing marital property. Secondly, the court will not view such a move approvingly, which can put you in a less favorable position during the divorce proceedings. Finally, an empty joint account means jeopardizing monthly payments, which can produce broader effects.
Being involved in a divorce is a challenging, financially, and emotionally draining experience. Couples undergoing this difficult period tend to overreact, making financial decisions that worsen their position and which they later regret (for example, emptying joint bank accounts). That is why you should never make a financial move during a divorce without consulting a family lawyer you trust. An experienced attorney will advise you on the best steps, including requesting the bank to freeze funds in your joint account until the divorce process ends.
Scott A. Levine, P.A. is a top-notch attorney in Fort Lauderdale, FL, practicing family law since 2004.
No family case is too complicated for Mr. Levine. With sophisticated legal and financial skills, Scott can help you protect your funds in separate bank accounts while ensuring fair distribution of marital property funds in joint accounts.
Call 954-587-2244 today to schedule a consultation with a local family law attorney.
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