Divorce can be emotionally and financially devastating. While the pain of a divorce is generally unavoidable, there are measures you can take to soften the blow of a dissolution and protect yourself during divorce proceedings. You may have heard that the assets you acquired prior to marriage are separate and not subject to division by the divorce court—this is true, but depending on the way you treat your separate property during the marriage, it can quickly become a marital asset to which your soon-to-be ex-spouse has legal rights. In this article, we explore steps you can take to keep premarital assets separate and shielded from division if you choose to divorce.
If you are thinking about divorce or you have just received divorce papers from your spouse, Plog & Stein P.C. can help ensure that the road ahead of you is as stress-free as possible. Our award-winning, experienced attorneys are dedicated to assisting individuals to achieve the best family law outcomes for their circumstances and needs.
What Happens with Premarital Assets at Divorce Proceedings?
When a couple decides to end their marriage, the court must divide their assets. Colorado’s family law court does not just divide all assets in half, but instead, the court divides assets equitably. Equitable division means a fair division of assets based on many factors, including each spouse’s resources, circumstances, and needs. And when the court allocates a divorcing couple’s finances, the court divides only the marital property.
Colorado Divorce Courts Do Not Divide Separate Property
In a dissolution of marriage, each spouse can keep the entirety of their separate property. There are many categories of separate property under Colorado family law, and premarital assets are considered separate property.
Some Actions Can Convert Separate Property into Marital Property
The assets you acquire prior to getting married are generally safe from division in a divorce proceeding, but if you engage in certain behaviors or if certain events occur during your marriage, your separate property can become marital property.
The following are the three main ways separate property can convert to marital property:
- If the separate property increases in value during the marriage;
- If the separate property is given as a gift to the other spouse; and
- If the spouses commingle their separate and marital property.
If some of those things have happened during the course of your marriage, property division during your divorce can become a far more complex process. Below, we discuss ways to avoid or diminish the partitioning of your premarital assets in a divorce.
How to Protect Your Premarital Assets
There are steps you can take before your marriage, during your marriage, and before divorce proceedings to decrease or eliminate the likelihood of the court dividing your premarital assets. Taking some of these actions while you are engaged or married can be uncomfortable to discuss because they involve sensitive issues, but they are essential actions to take.
Enter a Prenuptial or Separation Agreement
If they are fair, the divorce court has to comply with any property division terms you and your spouse include in a prenuptial or separation agreement. Whatever property you classify as separate in an enforceable contract with your spouse generally remains separate and not subject to allocation in a divorce. And the best way to make sure your separation or prenuptial agreement is enforceable is to hire an attorney to negotiate and draft the document.
Do Not Put Your Spouse’s Name on the Title of Any Premarital Property
If you give a gift to your spouse, that gift is considered marital property. One way many individuals give gifts to their spouses is by putting a spouse’s name on deeds, titles, and accounts. Including your spouse’s name on the title of your premarital property signals to the court that the property is not marital property. In some cases, you can argue to the court that the property should remain separate, but you must prove your argument with clear and convincing evidence, which is a very high burden of proof.
Do Not Mix Marital Assets with Premarital Assets
For several reasons, mixing (or commingling) your premarital property with your spouse’s property can affect the number of assets you get to keep in a divorce. If you want to keep your premarital property separate, you should consider the following:
- Commingling your assets could cause your separate property to increase in value, converting some of it into marital property;
- Allowing your spouse to make contributions to the upkeep of your premarital property might make a divorce court presume that the property is a gift to your spouse that should be treated as marital property; and
- Commingling your property with your spouse’s property can make it incredibly difficult to determine which assets belong to whom during dissolution proceedings.
To separate commingled property, you might have to hire a forensic accountant, which can be an expensive and complex undertaking.
Hire an Experienced Family Law Attorney
If you have concerns about keeping your premarital property separate, speak to a knowledgeable divorce attorney immediately. At whatever stage you are in the divorce process (or premarital process), your attorney can put safeguards in place for your assets and negotiate enforceable settlements that allow you to keep as much property as possible.
While nobody likes to think about divorce when they are in the throes of love and preparing for a wedding, it’s still prudent to have an honest and open conversation about the issues. Being realistic at the beginning of your relationship can save a lot of heartaches and expenses down the line. The divorce process can become less difficult and more predictable with a skillful attorney by your side.
Contact Plog & Stein’s Experienced Family Law Attorneys Today
Inviting the court to make decisions about your personal life and family is a sensitive process. Divorce proceedings should be handled with skill, diligence, and care. At Plog & Stein, we have the knowledge, dedication, and empathy to help you make the best out of difficult times.
Plog & Stein has been dedicated to providing top-notch family law advice to the Denver community since 1999. We are an award-winning family law firm, and our attorneys have over 70 years of combined experience. We collaborate with our clients to ensure that we meet their specific needs during family law proceedings and that they feel cared for and heard. If you need help, please call us at 720-928-9615 or contact us online.