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Marital and non-marital property, retirement assets, the family home, debt, and how a monetary award works.
Maryland is an equitable distribution state, not a community property state. That single distinction explains most of what surprises people about property division here. Nothing is automatically split down the middle, and the name on a title does not settle the question.
Instead, the court follows a three step process, and the outcome is what the court considers equitable on the facts, which is not always the same as equal.
Marital property is generally property acquired during the marriage, regardless of whose name is on it and regardless of who paid for it. That includes the family home, vehicles, bank and investment accounts, business interests, and retirement benefits earned during the marriage.
Non-marital property generally includes:
This is where most real disputes live. An inheritance deposited into a joint account, or a premarital house paid down with marital earnings, does not stay cleanly separate. The property may become partly or entirely marital.
The burden falls on the spouse claiming an asset is non-marital to trace it. Documentation from years ago becomes the whole case. If you have it, preserve it. If you do not, discovery may be able to reconstruct it from institutional records.
Usually the largest asset and the most emotionally loaded. Options generally include selling and dividing the proceeds, one spouse buying out the other, or a deferred sale. Where minor children are involved, a court may address use and possession of the family home separately from ownership.
Pensions, 401(k) plans, IRAs and deferred compensation are frequently the second largest asset and are routinely underestimated. The portion earned during the marriage is generally marital even though only one spouse’s name is on it. Dividing these accounts usually requires a separate court order directed to the plan administrator, and an agreement that divides a pension “in principle” without that order has not actually divided anything.
A closely held business or professional practice requires valuation, and the valuation method matters as much as the arithmetic. See high asset and business owner divorce.
Debt incurred for family purposes during the marriage is generally treated as marital. A crucial practical point: an agreement or order assigning a joint debt to one spouse does not bind the lender. If your name is on the loan, the creditor can still pursue you. Refinancing or removing a name is a separate step that has to be planned for.
Because Maryland courts generally cannot simply retitle most property from one spouse to the other, the primary tool for achieving equity is a monetary award. Before granting one, a court considers factors set out by statute, including:
Non-monetary contribution is a real factor, not a courtesy. Years spent raising children or supporting a spouse’s career count.
Property division and alimony are decided together, and each affects the other. After the divorce, deeds, titles, beneficiary designations, wills and powers of attorney generally need updating, since a divorce does not automatically fix every document naming a former spouse. See estate planning.
Related: settlement agreements, the divorce process.
Every divorce and custody matter turns on its own facts. The Law Office of Thomas K. Mallon, LLC offers a free consultation so you can get straight answers about your situation before you decide what to do next.
Call (410) 847-9075 or request a consultation online. The office is at 1107 Kenilworth Drive, Suite 305, Towson, MD 21204.
This page provides general information about Maryland law. It is not legal advice, and reading it does not create an attorney-client relationship. Maryland law changes, and how it applies depends on the facts of your case.