Division of Property and Debts

During your marriage you have accumulated
certain property and incurred certain debts which must be divided between you and your
spouse. The total of property and debts is commonly referred to as the “marital estate”.
All property and debts arising after the date of your marriage are presumed by law to be
part of the marital estate. This is so despite who may have earned or purchased the
property, or who may have incurred the debt. Marriage under Missouri law is a joint
venture with very few exceptions.

The marital estate has a value in terms of dollars. The presumption of the Court is to
award one half of the total value of the marital estate to you and one half to your spouse.
The Court does not focus on the specific item of property but looks at each item in terms

of it’s dollar value in order to equalize the “value” awarded to both parties. (eg. You
receive real estate worth $100,000 and your spouse receives retirement accounts worth
$100,000) Property for which a debt is owed has a value defined in terms of equity.
(Equity = Fair Market Value – indebtedness: e.g. Value of Real Estate is $50,000 when
the house has a market value of $150,000 with a mortgage debt of $100,000)

One of the most frequently asked questions in a divorce relates to how the court
determines which property is separate and which property is marital.

In Missouri, certain types of property are considered separate by law:

Inheritance (even if inherited during your marriage)
[Example: your grandma dies and leaves you $500,000 – it’s your separate
Gifts to you (even if given to you during the marriage)
[Example: your parents give you, and you alone, 50,000 shares of stock
while you are married – it’s your separate property]
Property acquired before marriage
[Example: you bought a car before getting married – it’s your separate
Property acquired during marriage with funds from once separate property
[Example: you sell the car you owned prior to marriage and buy some
stock with the proceeds during marriage – the stock is still your separate
property because the money used to buy it came from separate property]
The increase in value of separate property is still separate
[Example: you buy some cheap stock before marriage and then it triples
in value during your marriage – the stock, no matter how much it has
increased in value, is all your separate property]

Even though this rule on separate property seems quite simple, certain actions taken
during the marriage can transform separate property into marital property (or at least
create a marital component to separate property):

o Commingling of assets: when you mix your separate property together with
marital property, it can all become marital
[Example: you deposit your inheritance money into a joint bank account
and it all gets mixed together]
o Joint titling of assets: when you add your spouse’s name to the title of your
separate property, you make it marital
[Example: during the marriage, you refinance the home you owned
separately from before the marriage and now your spouse’s name is listed
on the title as a joint tenant]
o Marital income is invested in once separate assets: the rule in Missouri is that
income from any source is MARITAL, so when you use income earned during
your marriage to reduce mortgage principal on a separate asset, or you contribute
income earned during the marriage to a separate asset, a marital component is

1) Even though you own a home from prior to the marriage,
you continue to make payments toward the mortgage while
married – this pay-down of the mortgage may build up a
corresponding amount of equity in the home, which is now a
marital component of your separate asset.
2) Even though you own stock from prior to the marriage, you
allow dividends (which are income) to be reinvested in the
same stock, creating a marital component to your separate
3) Even though you have a 401(k) plan from prior to the marriage,
you continue to contribute income during the marriage to
the account, creating a marital component to your separate
retirement account.]

Determining which assets are separate and which are marital (or which portion may
be marital) is an extremely complicated endeavor, requiring a thorough knowledge
of the law, expert financial analysis and diligent tracing of funds.

At Medler & Roither, our attorneys are extremely well-versed in determining the
characterization of separate versus marital assets. Our experience ensures that our
clients obtain the best financial division of their assets upon divorce.