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How Assets Are Divided in Pennsylvania Divorce: What to Know

The divorce process is inherently stressful and emotionally painful. This process is often made even worse when people begin contesting property division. If you desire an uncontested divorce, you should consider mediation for property division in a divorce.

In this article, the experienced Philadelphia divorce mediators at Peaceful Separation and Divorce outline the property division process in a divorce in Pennsylvania.

Mediation in Asset Division

Mediation is an alternative dispute resolution process couples can use to settle property division issues outside court. Spouses can choose a neutral third-party mediator who guides them toward a mutually acceptable agreement on dividing their assets in a divorce. Unlike formal litigation, which requires a divorce attorney, mediation provides a non-confrontational method to split assets in a divorce.

How Assets Are Divided in Pennsylvania

Unlike community property states, certain assets acquired by either spouse during the marriage are presumed to be marital property according to §3501(b) of the Pennsylvania Rules of Civil Procedure, in Pennsylvania. During a divorce in Pennsylvania, one spouse or the other can file a request with the court to divide property and distribute marital assets. Unlike a community property state, Pennsylvania follows the principle of equitable distribution concerning property division.

A Brief Definition of Equitable Distribution

Under §3502(a), Pennsylvania is an equitable distribution jurisdiction with regards to dividing property. Unlike community property states, only marital property is divided fairly, but not necessarily equally, between the spouses during divorce proceedings. Additionally, courts do not consider marital misconduct by either spouse or the other spouse when splitting assets.

Marital Property vs. Separate Property

Under §3501(a), marital property includes assets one or both spouses acquired during the marriage, including real estate, the family home, marital funds, investment accounts, individual retirement accounts, and retirement assets. Separate property includes gifts, inheritance, property acquired before marriage, property acquired after separation by one spouse or the other spouse, and items excluded by pre or post-nuptial agreements. Separate property, i.e., non-marital property, is not subject to being equitably divided as it is not considered marital property.

Preparing for Asset Division

If you are going through a divorce in Pennsylvania, you should gather documentation of all marital assets and debts, including bank statements, tax returns, and mortgage statements. In addition to information regarding marital property, you should also gather documents relating to items that may be classified as separate property. By preparing for asset division, you can ensure you are in the best position to retain separate property properly, obtain an equitable division of other assets, avoid excessive legal fees, and move forward with your divorce after dividing assets with your soon-to-be ex.

List Your Assets

To prepare for asset division, it is important to list all assets, including bank accounts, the family home, real estate, investments, retirement accounts, retirement plans, and personal property. You must provide an inventory of your marital and non-marital property pursuant to §3505(b) for your divorce case. By preparing this inventory for mediation, you can save time and money and ensure your future financial plans.

Value Your Property

It is also important to determine the cash value of your assets, including bank accounts and retirement accounts, which can be done through appraisals or by contacting your financial institution to verify the balance of your bank account and any joint accounts owned by you and your spouse. Knowing the value and financial aspects of each asset can help ensure a fair property division and avoid potential tax consequences. This is because the portion of a non-marital asset that increases in value may be considered marital property and, therefore, subject to being divided.

Summary of How Assets Are Split in Divorce

In Pennsylvania, marital assets are divided equitably or fairly but not necessarily equally during a divorce. Due to the complex process of properly classifying separate and marital property and splitting assets, it is advisable to explore mediation as an alternative to formal litigation. Dividing assets during a divorce doesn’t have to be contentious or overwhelming. For personalized support and guidance, consult a trusted divorce mediation lawyer to explore mediation and achieve a fair resolution tailored to your needs.