Dividing your money, property and debts when you divorce can be one of the most complex steps in the process. Often, people misunderstand the laws or how division works. For instance, one of the most common misconceptions is that you will just divide everything you have in half.
However, this is an oversimplification of the process.
Community property laws in Wisconsin
Wisconsin is one of the few states with laws that presume all assets and liabilities acquired during a marriage belong equally to both parties. This is the community property theory, which means the courts will divide eligible property equally.
That said, there are reasons why you could wind up with an arrangement that is not 50/50.
- Separate vs. marital property: Community property laws only cover marital property or things that either party acquired during a marriage. Separate property is not eligible for division. In other words, one person’s gifts or inheritances generally remain with that person.
- Discretion of the court: Courts could deviate from this 50/50 balance for several reasons. For example, they could do so if one of you has substantially more separate property or if you have a prenuptial agreement in place.
While it might seem like all you need to do is divide property down the middle, these are just some reasons why doing so may not be fair or feasible.
Other complications that can arise
Even if you divide your marital assets equally, other complications could create challenges. Some of the more common obstacles you might face include:
- Disputes over property valuations
- Questions over whether a property is separate or marital (e.g., commingled assets)
- Logistical challenges of buying each other out, trading assets or avoiding penalties of dividing property like retirement accounts
- Fights over keeping specific property
- Allegations of hidden assets
Matters like this can make it difficult to understand what you have, what something is worth and how to divide it.
During a tumultuous event like divorce, it can be tough to get the answers necessary to make informed, wise decisions. Rather than leaning on misconceptions or jumping to conclusions, you can use this information and the guidance of an attorney to avoid setbacks and disappointments during the property division process.