One of the most common things that I hear when a new client contemplating divorce walks into the office is “The house and cars are titled only in my spouse’s name.  I’m going to have nothing after the divorce.”

In Indiana, the law presumes that an equal division of the “marital estate” is just and reasonable, Indiana Code §31-15-7-5.  Before an equal division can be made, one must define “marital estate”.  Generally, the marital estate is, with a few exceptions, anything and everything that either party had prior to the marriage or acquired during the marriage. It does not matter how the property is titled or who purchased the property, it is all part of the marital estate.  This also includes things such as a 401(k) or an IRA.  The marital estate does not just include assets, it also includes debts as well.  That means if a person comes into the marriage or acquires a lot of debt during the marriage, all of that debt often becomes debt of the marital estate.

Initially, one must begin listing all titled property, personal property, bank accounts of any kind, retirement accounts, etc.  Evaluations must then be done to determine the value of each of these items.  A bank account is simple:  how much is in the bank account is what it is worth.  However, when determining the value of a house, for example, the parties can go about determining its fair market value in several ways, but one of the most common method is by getting an appraisal.

Once all of the assets are valued, then a detailed list of all debts must be made.  The mortgage, auto loans, student loans, credit card debt, etc.  Once the asset values has been totaled and the amount of debt has been determined, one can determine what the net equity of the marital estate is.  At this point, it is presumed that each party should each receive approximately 50% of the net equity in the marital estate.  That doesn’t mean that everything has to be sold and divided equally.  The parties and/or the court can get creative in determining the best way to divide the assets. In theory, dividing the marital estate should be easy.  However, in practice, it becomes much harder to find the most just and equitable way to equally distribute the marital estate without forcing the sale of the marital residence, the vehicles, or other significant assets.

The presumption of an equal division of the marital estate is rebuttable, however. That means that one party to the divorce can argue that some specific asset shouldn’t be considered part of the marital estate.   For example, if one party receives an inheritance from a relative, and that money was placed into a bank account completely separate from anything marital related, none of that money was ever used to pay the mortgage or put a new roof on the house, then one could argue that this money is kept wholly separate from the marital estate.  The judge has wide discretion when deciding whether something like this inheritance is considered part of the marital estate and the judge’s decision is always made on a case by case basis, Nickels v. Nickels, 834 N.E.2d 1091, 1098 (Ind. App. 2005).  Simply titling something in one of the party’ name does not mean that it is not a marital asset subject to equal division upon divorce. One should rest assured that the result of a divorce should be a just and reasonable division of the marital estate for both parties.

No two cases are exactly the same, so determining how a division of the marital estate might look in your specific situation often requires the assistance of an attorney knowledgeable in this area.