Property Division in a Minnesota Divorce

PROPERTY DIVISION UPON DIVORCE

There are two types of property in Minnesota—marital property and nonmarital property. In a divorce, all marital property is to be divided and distributed equitably between the parties. Conversely, all nonmarital property is typically awarded to its owner, and is generally not considered in the overall property distribution (unless it would cause unfair hardship not to do so).

Marital Property

Marital property is property (real estate and personal property) including vested public or private pension plan benefits or rights, acquired by the parties, or either of them, during the marriage. All property acquired by either spouse after the date of the marriage is presumed to be marital property, regardless of whether title is held individually or jointly. This presumption is overcome by a showing that the property is nonmarital property. There may be property which is both marital and nonmarital in nature, and, in Minnesota, there is a conclusive presumption that each spouse made a substantial contribution to the acquisition of income and property while they were living together as husband and wife. Equitable distribution of marital property does not necessarily mean equal distribution. However, it is typical for Minnesota courts to order near-equal divisions of marital property.

Nonmarital Property

Nonmarital property is property (real estate and personal property) acquired by either spouse before, during, or after the marriage which (1) is acquired as a gift, bequest, devise or inheritance made by a third party to only one spouse; (2) is acquired before the marriage; (3) is acquired in exchange for or is the increase in value of nonmarital property; (4) is acquired by a spouse after the valuation date; or (5) is excluded by a valid antenuptial contract. Nonmarital property or assets may lose their nonmarital character by being merged with marital property, unless it can be readily traced. 

Generally, the party attempting to show that property should be classified as nonmarital must prove the above factors by a preponderance of the evidence. If, however, the nonmarital property is a gift, the gift must be established by clear and convincing evidence, and generally requires (1) donative intent; (2) delivery of the gift; and (3) absolute disposition of the property. 

There is a difference between income and appreciation of nonmarital property. Income received from nonmarital property is considered marital property, while passive appreciation due to normal market forces retains its nonmarital character. Additionally, any interest earned on a nonmarital asset is considered marital income.

MINNESOTA FAMILY LAW ATTORNEYS

If you are going through a divorce, it is crucial that you retain the services of a family law attorney to help ensure that marital property is divided and distributed fair and equitably. Contact the family law attorneys at RAM Law PLLC today to schedule your free consultation.