Community property vs. equitable distribution
Nine states divide property according to community property law, while the rest apply equitable distribution principles. They are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin.
Community property distribution
With community property distribution, all assets accumulated by the parties during the course of the marriage are considered owned jointly by them. Courts basically add up the value of the assets and then divide that in half, distributing one half of the assets to each party. It is a simple mathematical procedure, with no other contributing factors.
In awarding spousal and child support, the courts in a community property state may consider how long the couple has been married, the age of each party or ability of either one to be employed, based on their health or employment background, even though these factors are not considered in the distribution of assets.
Equitable distribution of property
Equitable distribution states allow divorce courts a lot of discretion in dividing marital assets in an equitable, or fair, manner. Courts can consider any relevant factor in achieving an equitable distribution. The most common considerations include:
—Length of the marriage.
—Age of the spouses.
—Health of each spouse.
—Ability of each spouse to support themselves.
—The fact that one spouse did not pursue a career in order to care for children.
A court may balance a small award of spousal and child support with a greater distribution of assets. In some states, although not the law, a fair policy provides for one party to be awarded at least one-third of the assets accumulated during the marriage.
Negotiated divorce settlements allowed in all states
Whether they live in an equitable distribution or community property state, the parties can choose to negotiate their own property settlement that courts will honor. Their distribution agreement does not have to follow the laws of their state.
Source: "The American Legal Journal"