Splitting properties tends to be one of the most contentious issues spouses face during divorce. It entails countless negotiations, as they weigh which assets they are willing to compromise and which they will fight for. While the process is complex as it is, another factor that can further complicate it is the commingling of assets.
Commingled assets are a result of mixing separate and marital properties. Maryland law defines separate property as anything owned before the marriage, or an inheritance or gift acquired by only one party. Conversely, marital property is anything obtained while married.
Among potential complications is how the state maintains that items bought with commingled funds become marital properties. Thus, knowing how to avert difficulties can help move the divorce forward with little to no dispute.
Commingled assets are preventable
While divorce circumstances vary, the following are common ways to avoid commingled assets:
- Maintain separate bank accounts or credit cards: Deposit inheritances or gifts in accounts bearing the sole recipient’s name.
- Use prenuptial or postnuptial agreements: Explicitly state which assets belong to whom and indicate specific exemptions in clear clauses wherever applicable.
- Keep detailed records: A thorough documentation can especially help those with significant wealth track expenses, revenues and taxes.
- Use own names in purchases: Joint ownership of a car or house can be challenging to untangle in the long run, so it will be wise not to add the other party as a co-owner.
- Consult financial and legal professionals: Navigating all these complexities can be overwhelming, but proper guidance can protect each spouse’s fair share of marital wealth.
These careful financial tips can help secure assets with their rightful owners. Following these measures can also assist couples in avoiding time-consuming and costly court proceedings for untangling commingled assets.
The family’s financial future is at stake
Divorce risks both parties’ economic health. Thus, it is critical to avoid commingling of assets as it can only aggravate tensions and disputes. Instead, diligent financial planning can direct couples to an amicable process for their and their child’s stable future.