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In Oregon, divorce laws follow the rule of equitable distribution, where assets and debts are divided in a manner that is considered to be “fair” to both parties. This does not necessarily mean that assets will be divided on a 50/50 basis. Before dividing personal property, the court must determine whether the personal property is marital property or separate property.
Most assets accumulated over the course of a marriage are considered marital property, however, there are exceptions (for instance, gifts and inheritance are considered separate property). Separate property is awarded only to the spouse who owns it. However, if one party brought an asset into the marriage and commingled it with other property, the asset would then be considered to be marital property. In other words, if you brought personal property into the marriage but then commingled it with marital property, the court will consider it to be marital property.
Courts will also look at other factors when determining what is an equitable distribution. Those factors include the length of the marriage, tax consequences, if one spouse will be responsible for taking care of minor children, sources of future income, the employability of each spouse, etc. In Oregon, the court presumes that the spouses contributed equally to the acquisition of property during marriage, regardless of what the title says.
Pension and retirement accounts are considered to be marital property in Oregon. However, this rule applies only to the amounts accumulated over the course of the marriage. Any amounts before a marriage or after the date of separation will be considered to be separate property. Legally splitting a pension or retirement account is done by a executing a qualified domestic relations order (“QDRO”). Depending on the terms of the settlement, the spouse may get up to half of the value of the pension plan.
If you inherit something and you keep it completely separate during the course of your marriage, it is considered to be separate property. That said, all divisions of assets are subject to court review and approval to ensure a split is just and fair. One way to safeguard an inheritance is to have your spouse sign a pre-nup or post-nup contract, agreeing that the asset belongs exclusively to you, no matter how it is characterized during the marriage.
In general, any property that you acquire prior to marriage or after the date of separation is considered separate property. That said, if you commingle with marital property, the court will no longer consider it to be separate property. For instance, depositing money received from a gift into a joint bank account can be considered commingling.