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How to Categorize and Divide Assets and Liabilities During Pre-Suit Divorce Mediation in Florida
|Beth Reineke, founder of Reineke Mediations, fully understands that one of pre-suit mediation’s advantages is recognizing and resolving financial disputes during the initial phase of a Florida divorce before this hinders the process and the parties end up in protracted and expensive divorce litigation.
Even with the assistance of an experienced family law mediator, dividing assets and liabilities during divorce mediation in Florida is a detailed and methodical process. The aim is to reach a fair and equitable agreement by categorizing assets and liabilities as marital or non-marital, valuing them accurately, and negotiating an equitable settlement in good faith. This meticulous approach ensures that both parties feel reassured about the fairness of the mediation outcome.
How Can a Florida Mediator Help with Categorizing & Dividing Assets and Liabilities During a Florida Divorce
Beth Reineke is an experienced mediator and family law attorney. She brings a wealth of knowledge to her clients’ divorce mediation sessions. With a degree in finance from the University of South Florida and over 30 years litigating and mediating family law matters, Beth is uniquely qualified to guide divorcing couples through the process of identifying, valuing, and dividing their financial assets and liabilities prior to filing for divorce. Her expertise ensures that the division of assets and liabilities is accurate and that the parties are satisfied that the agreed upon division is fair and equitable, enabling the parties to proceed with a streamlined uncontested divorce action.
For instance, the identification, valuation and division of assets during pre-suit mediation, includes ensuring both spouses understand which assets are Marital Assets and which assets are not Marital Assets. Both spouses also need to understand which assets might require special treatment – IRAs, 401Ks, Annuities, Pensions, and which assets/investments should not necessarily be liquidated because of potential tax liabilities…
In a divorce situation Marital Assets often include:
- Homes, rental properties, vacation homes, and undeveloped land.
- Ownership interests in businesses.
- Automobiles, motorcycles and recreational vehicles.
- Post-tax assets like checking and saving accounts.
- Pre-tax assets like 401Ks, 403Bs, Thrift Savings Plans, Pensions, and Traditional IRAs.
- Brokerage accounts, Annuities, Cryptocurrencies, and other types of investments.
- Vehicles, jewelry, artwork, and collectibles.
The difference between pre- and post-tax assets, and the restrictions thereon, can be a significant factor in divorce proceedings, including those settled through pre-suit mediation, so they often require careful consideration. Understanding how these assets are valued, the potential tax implications of dividing or distributing a particular type of asset, and each spouse’s future financial needs is crucial for fashioning an equitable division of the couples’ assets during mediation.
What are the Key Considerations for Categorizing and Dividing Assets During Mediation in Florida?
Categorizing and dividing assets during mediation in Florida requires careful consideration of various factors, including asset classification, valuation, equitable distribution principles, and the financial needs of both parties.
Our skilled Florida divorce mediator can help with the following:
Identification of Assets and Liabilities
- Creating a detailed inventory of all assets and liabilities, including real estate, personal property, financial accounts, retirement accounts, and debts.
- Gathering all relevant documents, such as property deeds, bank statements, investment account statements, loan documents, and other financial records.
Classification of Assets and Liabilities
- Distinguishing between Marital Assets (acquired during the marriage) and Non-Marital Assets (acquired before the marriage, or by inheritance, or as gifts to one spouse from a third party).
- Addressing any commingling issues where Non-Marital Assets have been mixed with Marital Assets, which may affect their classification and whether they are part of the financial pie to be divided.
Valuation of Assets
- Determining the current fair market value of all assets. This may require professional appraisals for real estate, businesses, and valuable personal property.
- Considering the potential tax consequences of selling, liquidating, or transferring assets.
Equitable Distribution Principles
Florida law follows the principle of equitable distribution, which means assets and liabilities should be divided fairly but not necessarily equally. While the court and most couples generally agree that equal is fair and equitable, there are some circumstances which would justify an unequal distribution of assets and liabilities.
The Statutory Factors that a court would consider in determining whether an unequal distribution is appropriate include:
(a) The contribution to the marriage by each spouse, including contributions to the care and education of the children and services as homemaker.
(b) The economic circumstances of the parties.
(c) The duration of the marriage.
(d) Any interruption of personal careers or educational opportunities of either party.
(e) The contribution of one spouse to the personal career or educational opportunity of the other spouse.
(f) The desirability of retaining any asset, including an interest in a business, corporation, or professional practice, intact and free from any claim or interference by the other party.
(g) The contribution of each spouse to the acquisition, enhancement, and production of income or the improvement of, or the incurring of liabilities related to, both the marital assets and the nonmarital assets of one of the parties.
(h) The desirability of retaining the marital home as a residence for any dependent child and, if not, whether other equities would be served by giving any other party exclusive use and possession of the marital home.
(i) The intentional dissipation, waste, depletion, or destruction of marital assets within 2 years prior to the filing for divorce.
(j) Any other factors necessary to do equity and justice between the parties.
Proper preparation, open communication, and professional guidance during your mediation can help ensure a fair and equitable resolution that is in the best interests of all parties involved.
Whether you both live in Florida or one spouse lives out of state or country, our skilled mediator offers the flexibility of in-person and virtual mediation sessions. This accommodation facilitates productive discussions between couples living outside of Hillsborough County, helping them reach mutually acceptable solutions to all their unique divorce and family-related issues, including complex property division.
Set up a free phone consultation with Attorney/Mediator Beth Reineke to assess whether pre-suit mediation or another alternative dispute resolution method suits your divorce or family law needs. Contact Beth Reineke
