Practice Area
Marital Debt & Liabilities
Boca Raton Divorce Attorney for Marital Debt and Liabilities
Dividing Debt Can Be as Important as Dividing Assets
Property division in a divorce involves more than determining who receives the house, investments and other assets. The parties' debts and financial obligations must also be identified, classified and allocated.
Mortgages, credit cards, lines of credit, tax obligations, business debt and other liabilities can significantly affect the true value of a divorce settlement.
Barbra helps clients understand both sides of the marital balance sheet — what the parties own and what they owe.
What Is Marital Debt in Florida?
Florida's equitable distribution law applies to marital liabilities as well as marital assets. Liabilities incurred during the marriage are generally presumed to be marital unless they are established as nonmarital under Florida law. The court begins with the premise of an equal distribution of the marital estate, but it may make an unequal distribution when legally justified.
Potential marital liabilities can include:
The name appearing on an account or loan does not necessarily determine who will ultimately be responsible for the debt between divorcing spouses.
Marital Versus Nonmarital Liabilities
Just as some assets may be nonmarital, certain debts may also be treated as nonmarital.
The timing and circumstances surrounding the debt can be important. For example, liabilities incurred before marriage may generally be treated differently from obligations incurred during the marriage. Florida law also specifically treats certain liabilities arising from forgery or an unauthorized signature as nonmarital liabilities of the spouse responsible.
Complex questions can arise when debt was incurred for a business, when one spouse controlled the family's finances, or when substantial debt was accumulated shortly before or during divorce proceedings.
Waste, Dissipation and Unusual Spending
In some divorces, one spouse alleges that the other improperly spent, transferred or depleted marital funds.
Florida's equitable distribution statute permits courts to consider intentional dissipation, waste, depletion or destruction of marital assets occurring after the divorce petition is filed or within two years before filing.
These issues may involve excessive personal spending, unexplained withdrawals, transfers to third parties or other transactions that warrant closer examination. When substantial amounts are involved, financial records and forensic accounting may be necessary to determine what occurred.
Looking Beyond Who Is Assigned the Debt
A divorce judgment or settlement can allocate responsibility for a debt between spouses, but the divorce itself does not necessarily eliminate a creditor's contractual rights against someone whose name remains on the underlying obligation.
That distinction can be particularly important with mortgages, joint credit cards, business guarantees and other jointly incurred debt.
For that reason, Barbra looks beyond simply assigning each liability and considers how the allocation will actually affect the client's financial position after divorce.
Protecting Your Financial Future
A favorable division of assets can be undermined by an unfavorable allocation of liabilities. In financially complex divorces, assets and debts should therefore be analyzed together.
Barbra Amron Weisberg, P.A. represents clients in Boca Raton and throughout South Florida in divorce matters involving significant assets, business interests and complex financial obligations. Schedule a private consultation with Barbra Amron Weisberg, P.A.