How Does Property Division Work in Minnesota?

As an equitable distribution state, Minnesota handles property division differently than many states. In Minnesota, all assets and debts acquired during your marriage are considered “marital property” by the court. The only exceptions are gifts or inheritances explicitly awarded to one party as “separate property.”

Equitable Distribution of Marital Property in MN

The court takes an inventory of all marital property and then divides that property “equitably” between the two parties. An “equitable” division of property does not mean that marital property gets divided 50/50 between both parties. Instead, the court tries to divide assets and debts in a way that enables both parties to maintain a good quality of life post-divorce. For example, if the parents share children, and one parent gets sole custody, the court might award the custodial parent the entirety of the marital house to assist with childcare. During the property division process, neither party can take any actions that affect the value of assets (such as selling off or damaging an asset).

How Can I Prepare for Property Division?

If you’re getting ready to move forward with a property division case, here are some things you can do to get ready:

• Inventory your assets and liabilities. During the property division process, the court will ask both you and your soon-to-be-ex to provide an exhaustive list of every asset and liability you possess. From your rug to your car, you need to catalog all your property. The same goes for financial and business assets. Your income, investments, bank accounts, tax returns, stocks, etc. should all be thoroughly documented. Gathering this information ahead of time helps make the process less arduous. Omitting any assets can result in legal penalties, so getting a head start helps you ensure that you don’t accidentally hide any assets or liabilities from the court.
• Value your property. A certified public accountant (CPA) specializing in asset valuation can help you determine how much your assets are worth. Knowing their value ahead of time can help you brace for the financial impact of potentially losing half or more of your marital assets.
• Work with your attorney to determine what assets might be separate property vs. marital property. As we mentioned before, almost all assets acquired during your marriage will be considered “marital assets” by Minnesota courts. However, documents such as prenups or postnuptial agreements can play a huge role in the property division process. You should work with your attorney to see if you can qualify certain assets as separate property, making them exempt from the division of assets and debts.
• Work with your attorney to draft your ideal property division settlement. The court doesn’t necessarily have to decide your case—if both parties agree on how to distribute assets and liabilities, you can settle out of court. Work with your attorney to begin drafting a potential property division settlement to showcase to the other party. A settlement can be a less stressful, more cost-effective way of handling the property division process. A settlement also helps both parties reach a mutually beneficial arrangement, instead of leaving your assets and liabilities in the hands of the court for distribution.

Protect Your Separate Property – Call Johnson/Turner Legal

At Johnson/Turner Legal, we can help you understand the property division process more thoroughly and face your case with confidence.