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Valuation of Marital Property in Divorce Proceedings

One of the most critical parts of the property distribution process in divorce is ensuring that the marital assets have been properly valued. Either an overvaluation or an undervaluation of the spouses' marital property can prevent the parties from receiving their fair share when their assets are divided.

Community Property in Divorce

In a pure community property system, property acquired during marriage other than by gift or inheritance from a third party is presumed to be community property and will be divided equally between the parties in divorce. Property that a spouse brings into the marriage or acquires during marriage by gift or inheritance from a third party is presumed to be separate property. Community property states generally consider a gift from one spouse to the other to be the recipient's separate property.

Spouses as Witnesses in Divorce Proceedings

In general, either spouse can testify in a ''no fault'' divorce proceeding, in a fault-based divorce proceeding, in a property settlement hearing, or in proceedings relating to custody determinations. While such testimony can be highly relevant in a divorce proceeding, there are some rules (including the marital communications and anti-marital facts privileges) that come into play when considering the admissibility of such testimony.

Property Division in Divorce: Valuation of Marital Property

In divorce cases, courts usually must divide the parties' marital property between them. Marital property usually includes both marital assets and marital debts, and generally consists of all property acquired by both or either of the spouses during the marriage, other than property acquired by inheritance or gift from a third party. State divorce laws handle marital property differently depending on whether the state follows equitable distribution, straight community property, "all property," or dual property rules.