Aug 6

Financial Consequences of a Short-Term Marriage

Many people ask about the financial consequences of a divorce of a short-term marriage.  There are frequent stories in the news about divorces resulting in enormous property distributions and long-term spousal maintenance (what was once known as alimony) awards but those considering a divorce should realize these awards are generally reserved for longer marriages.

New York’s Domestic Relations Law allows the courts to order (1) equitable distribution of “marital property” and (2) maintenance.

Equitable Distribution

As a starting point, it should be noted that equitable distribution only applies to “marital property” meaning that the court generally can only distribute property acquired by either spouse during the course of the marriage.  As a result, property such as a home purchased prior to the marriage, is not eligible for distribution during a divorce proceeding and shall remain the “separate property” of the spouse who purchased it originally.  There is a presumption that property acquired during the marriage is marital property (and therefore subject to equitable distribution) but the statute provides for exceptions to this rule, such as inheritances or property designated as separate property by a prenuptial agreement.

Also relevant is that equitable distribution does not necessarily mean equal distribution.  The law provides for situations in which the court can order an unequal division of marital property due to circumstances of the marriage or the parties.  In general though, the courts tend to distribute marital property equally among parties.

Especially in short term marriages, people are curious about the equitable distribution of wedding gifts.  The courts have held that wedding presents are marital property and therefore subject to equitable distribution.  Those considering giving a sizable wedding gift to a son, daughter, cousin-in-law’s brother, etc., should understand that the gift would probably be subject to equitable distribution if the marriage fails.

Maintenance

Maintenance, or alimony as it was once known, is a court-ordered sum of money to be paid by the spouse with greater assets to the less-monied spouse at regular intervals either for a set period of time (“durational maintenance”) or permanently.  Durational maintenance is intended to be rehabilitative in nature, meaning that the goal is to enable the less-monied spouse to earn a greater wage, hopefully comparable to the standard of living during the marriage.  Permanent maintenance is generally awarded only after long-term marriages in which there is a great disparity in the income, assets and earning capacities of the spouses.  New York’s Domestic Relations Law provides a number of factors for the courts to use in determining a maintenance award and although the courts have great discretion in this area, generally a short-term marriage will yield a relatively small award of maintenance if there is any maintenance given at all.

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