Equitable Distribution of Property in Florida

Florida is an equitable distribution state. Under Florida Statutes § 61.075, the court begins with the premise that marital assets and liabilities should be divided equally between the spouses, but may depart from a 50/50 division based on statutory factors. Florida is not a community property state -- the analysis is fact-driven, not formulaic.

Step One: Classify Each Asset and Debt

The threshold question is always whether an asset or debt is marital or nonmarital. Only marital property is divided. Nonmarital property is set aside to the spouse who owns it.

Marital property generally includes:

• Assets acquired by either spouse during the marriage, regardless of which name is on the title
• The enhancement in value and appreciation of nonmarital assets resulting from marital labor or marital funds
• Interspousal gifts made during the marriage
• All vested and nonvested benefits, rights, and funds accrued during the marriage in retirement, pension, profit-sharing, and similar plans

Nonmarital property generally includes:

• Assets owned by either spouse before the marriage
• Assets acquired in exchange for nonmarital assets
• Income from nonmarital assets, unless it was treated as marital
• Assets acquired by gift (from a third party) or inheritance
• Assets excluded by a valid prenuptial or postnuptial agreement

Step Two: Date of Classification and Date of Valuation

The cutoff date for classifying assets as marital is typically the date the parties signed a valid separation agreement, or the date the divorce petition was filed. The court may use a different valuation date for different assets if equity requires it. For example, a retirement account may be valued as of the petition date, while a business may be valued as of the trial date.

Step Three: Apply the Statutory Factors

Florida Statutes § 61.075(1) lists factors that justify an unequal distribution, including:

• Each spouse's contribution to the marriage, including services as a homemaker
• The economic circumstances of each spouse
• The duration of the marriage
• Any interruption of careers or education
• Each spouse's contribution to the acquisition, enhancement, or production of marital assets
• The desirability of retaining the marital home as a residence for a child
• The desirability of retaining a business intact
• The intentional dissipation or waste of marital assets within the two years before filing or during the case
• Any other factor necessary to do equity and justice between the parties

A finding that one spouse intentionally dissipated assets -- by gambling, an affair, or extravagant gifts to a third party -- often produces a credit to the other spouse in the final distribution.

Tracing Premarital and Nonmarital Funds

One of the most common disputes is whether a once-nonmarital asset has become marital. Commingling premarital money in a joint account, using marital labor to grow a premarital business, or paying down a premarital mortgage with marital earnings can all convert part or all of a nonmarital asset into marital property. The spouse claiming nonmarital status bears the burden to trace the asset back to its nonmarital source, usually with bank statements, brokerage statements, and accounting work.

The Marital Home

The home is usually the largest single asset in a Florida divorce. Options include selling the home and dividing the proceeds, one spouse buying out the other, or one spouse retaining exclusive use while the children finish school (with a deferred sale at a later date). Each option has tax, mortgage, and homestead implications that should be analyzed before the agreement is signed.

Retirement Accounts and Pensions

Dividing 401(k)s, pensions, and federal retirement requires a Qualified Domestic Relations Order (QDRO) or a similar order tailored to the plan. The order must be drafted, signed by the judge, and approved by the plan administrator before any funds can be transferred. Getting the QDRO right is as important as the final judgment.

Call 786-522-1411 to discuss the equitable distribution of your marital estate.