Marital property in Pennsylvania is a legal term used to describe the property a divorce court may divide in a process known as equitable distribution. In Pennsylvania, we say the Divorce Code is “title blind,” meaning it does not matter whether property is titled in the name of the husband, the wife or both. Regardless of how it is titled, marital property is identified as all property acquired during the marriage. However, there are a few specific exceptions; the most frequent of which is property acquired by gift or inheritance.

The experienced divorce attorneys at Pollock Begg Komar Glasser & Vertz LLC guide you carefully through the arduous task of division of marital property during a divorce.

Is marital property different from community property?

Pennsylvania does not recognize the concept of community property, which is how married persons hold title to joint property in Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. Community property is a concept that deals with how the property is used during the marriage, as well as how it is divided upon divorce. In most instances, a Pennsylvania court is not concerned with how married persons choose to save, spend, transfer or dispose their property — until the spouses are separated. Once a separation occurs, spouses have a duty to prevent dissipation of marital property, and they may be required to give an account if they spend, gift or dispose property without the knowledge and consent of the other spouse.

In Pennsylvania, as in most states, property that is titled jointly in the names of spouses is held as entireties property. Entireties property is generally exempt from the claims of creditors of the individual spouses, and it passes to the surviving spouse upon the death of the other. Upon the entry of a divorce decree, entireties property converts to a different form of ownership in which each spouse owns a 50 percent share if they have not made an agreement or litigated in court to resolve their property ownership.

What is separate property?

Property acquired prior to marriage and property acquired by gift or inheritance during the marriage is designated as nonmarital property (also called separate property). As long as premarital property, gifts and inheritance remains in the name of one spouse individually, it retains its character as separate property. When separate property is retitled in joint names, however, it is presumed to be a gift to the marriage, which converts the separate property into marital property.

The divorce court has no jurisdiction to divide separate property but is required to ascertain any increase in the value of separate property during the marriage. An increase in value might result from market value (such as a stock whose share price increases or the interest income that is reinvested in a bank account) or the reduction of debt (such as paying down a mortgage). This increase in value can be divided in equitable distribution, just like marital property. Any decrease in value of separate property can be used to offset an increase in value of other separate property but cannot be offset against the value of marital property.

How is the value of marital and separate property calculated?

Marital property is typically valued at its fair market value on the date when a settlement is reached or the case comes to trial. Sometimes an appraisal is required. Under certain circumstances, an earlier valuation date may be used. For instance, if marital property is consumed after separation and is not used for marital purposes, it may be valued at the date of separation.

The increase in value of separate property is determined by subtraction. The court will deduct the value on the date of marriage (or acquisition, whichever is later) from the value on the date of separation (or the date of trial if that results in a smaller increase).

Call the family law attorneys at Pollock Begg to discuss your division marital property and consult on the best course of action for your future.

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