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community property & division of property in a divorce Archives

How will my divorce affect my business?

Sometimes Baton Rouge couples decide if they can enjoy a personal relationship with each other, sharing a business together might work out just as well. However, if the marriage hits the rocks and the couple decides to call it quits, the divorce process is also going to directly impact their business. Since both spouses own a part of the business, the company falls under Louisiana's community property laws and may be split up as well.

Mortages and divorces

When making the decision to end a marriage, spouses know that they will have to next choose how to split up their marital estate. For homeowners, this includes their family house which is also often their single biggest asset. However, some people forget that in addition to deciding what to do with the house means they must also decide what to do with their mortgage. 

Who gets the pets in a divorce?

The family pet is yet another issue in a divorce that many couples may not think about until the process is underway. Pets are generally thought of as property. They are considered the same as a car or an antique dresser. In Louisiana, the courts follow general property rules when determining pet custody, according to The Advocate.

A look at the fifty-fifty community property rule

Louisiana marriages that dissolve are subject to asset division under a fifty-fifty division law. This puts Louisiana in the minority of states, accompanied by Guam and Puerto Rico, that use a community property rule over an equitable division process. Individuals could expect to split everything down the middle based on the market value of the asset in question.

What is classified as separate property in a divorce?

If you are getting a divorce in Louisiana, you will eventually come to the part where property is divided. This can often be a difficult process, especially if you and your spouse cannot come to an agreement easily about how property should be divided. If the court steps in, it will look at both private and marital property to make its determinations. If you have separate property, you can protect it and ensure it stays under your control, but you need to know what is classified as separate property to do this.

How asset participation can affect separate property

Louisiana's status as a community property state means it is important for couples to understand what is and what is not considered marital property, as such property will be divided among the two spouses in the event of a divorce. Sometimes the distinction between separate and marital property is not clear because some separate property may actually contain value that could be considered marital property. This is where asset appreciation comes in.   

What happens with a mortgage in a divorce?

A large focus of your divorce settlement in Louisiana will be on dividing property and managing debt. The largest debt you likely will deal with is your mortgage. A mortgage is a special debt that is not handled as easily as others. Generally, it is in both of your names, and the lender will not care that you are divorcing and continue to hold you both accountable. 

A closer look at how debt is divided during a divorce

When a Louisiana couple makes the decision to end their divorce, they are immediately tasked with separating everything they share. This can include everything from property, to custody of their children, to debt. Reaching agreements that benefit both parties regarding shared items can be incredibly complicated at times, especially when both parties are unwilling to reach a compromise. Because no one wants to be left with a mounting load of debt, this aspect can be particularly challenging during a divorce. 

Tax considerations after a divorce

In the event of a divorce, couples have many financial things to worry about in Louisiana. One issue that may get overlooked but that requires some attention is the tax ramifications. When property is split during the divorce settlement process, couples need to be aware of how some property divisions may be taxed to avoid high taxes or being hit with serious penalties.

Things to keep in mind about divorce and debt

One issue that many people overlook during their divorces in Louisiana until after they are over is debt. While they are so busy focusing on getting their share of the marital property, they forget to consider who gets the marital debt. Joint debts that couples accumulate during their relationships do not disappear. Some debts that were acquired by one spouse can become the responsibility of both parties.