The process of divorce is often complex, particularly when it involves dividing marital property. In Illinois, this process follows the principle of “equitable distribution,” which means that the court should divide marital assets fairly, but not necessarily equally.
Avoiding common pitfalls during property division can make your divorce smoother and more manageable, and it is helpful to know what to be mindful of.
1. Not fully understanding marital versus non-marital property
One of the most common pitfalls during a divorce is not fully understanding the difference between marital and non-marital property. Marital property includes all assets acquired during the marriage, with some exceptions such as gifts and inheritances. Non-marital property typically consists of assets owned before the marriage, and gifts or inheritances received by one spouse. Make sure to correctly identify and categorize your property to ensure a fair division.
2. Rushing the process
Dividing property during a divorce is not a process to rush. It is important to take the time to assess the value of assets. This includes not just real estate, but also vehicles, household items, retirement accounts and investments. In your haste to conclude the process, you may overlook the value of certain assets and accept less than what the law entitles you to.
3. Not considering tax implications
It is also important to understand tax implications in your property division. Certain assets, such as retirement accounts, may be subject to taxes when withdrawn. Others, like the family home, may have significant capital gains tax implications when sold.
4. Forgetting about debts
When dividing property, it is important not to overlook marital debts. The courts consider debts acquired during the marriage marital debts and are subject to division, just like assets. Ignoring these debts could leave you liable for more than your fair share.
Avoiding common pitfalls in property division during a divorce can save you stress and potential financial hardship. By knowing what to watch for, you can work towards a fair and equitable division of property. Navigating these challenges can help you establish a stable financial future after your divorce.