Marriage is an economic partnership under the law. When you are married, both you and your spouse have a one-hundred percent right to each other’s income. You also have a duty to support each other. This is true even if one of you isn’t earning any money. A spouse who stays home is still providing financial benefits to the other spouse, such as taking care of the home, children or other responsibilities. However, once a spouse files for divorce, these rules change. Income is no longer marital property in divorce. Expenses are also treated differently. If you are considering divorce, it is important to understand what financial rights and obligations you and your spouse have to each other while your divorce is pending.
How Is Income Treated During the Divorce?
During marriage, income is considered “marital property.” This simply means it is designated as property that was acquired after the parties’ wedding date up to the date a divorce is filed and is subject to division in divorce. However, upon filing of a divorce action, each spouse’s income becomes his or her “separate property,” even though the marriage is still intact legally. Separate property is property acquired before the parties’ wedding date, after filing for divorce, or through inheritance or a gift made directly to a party during the marriage, provided it remains titled solely in that party’s name and not used during the marriage. Such property is not split in divorce unless it is converted into marital property.
As a result, your income while your divorce is pending is yours to keep, although you still have some financial responsibilities as discussed below.
Who Pays Joint Expenses?
Each spouse is responsible for his or her own expenses once the divorce action starts, except for those related to maintaining marital property. For example, mortgage and car loan payments, property and health insurance premiums, and similar costs remain joint expenses until the divorce process finally determines how they will be treated once the marriage is dissolved.
Do You Have to Pay Support or Have a Right to Receive Support While the Divorce is Pending?
When a divorce action is filed, the automatic orders rule goes into effect. This rule requires the financial status quo to be maintained between the spouses until there is a written agreement between the parties or a court order. The rationale is to prevent spouses from walking away from their financial obligations once they file for divorce. Generally, the spouse who earns less money is entitled to be paid spousal support. If the parties cannot agree on the amount, they can go to court, and the judge will order temporary support to be paid until a final support determination is made.
Can You Protect Your Income without Filing for Divorce?
If you’re married and not looking to divorce, you can protect your income as separate property at any time with a post-nuptial agreement. A post-nup is a contract made between spouses that addresses how they want to handle financial matters during their marriage or in the event they divorce or one of them dies. Such an agreement can address income and spousal support, the division of marital property, and how estate rights are handled, among other things.
A post-nup is beneficial even if you later decide to divorce because you will have already negotiated and resolved many of the financial issues that come up in divorce, saving you the time and money associated with litigation.
If you’re considering divorce, you should understand that filing for divorce changes your economic relationship with your spouse. Courts do not want to leave one side with insufficient funds while the divorce is pending. However, you want to get good legal advice to ensure that you are treated fairly both during the divorce and in your final settlement.
Contact us to help you get the best result possible in your divorce.
