Can You Divorce Without Splitting Assets?

Depending on what state you get divorced in, there are steps that can be taken to avoid splitting assets. The best thing to do to avoid the more common 50/50 split that a community property state imposes is to have a pre or post-nuptial agreement. If a state is not a community property or a "50/50" state, do not make the mistake of thinking you won't have to split assets. States that do not follow the 50/50 community property rule impose something referred to as "equitable division," which may not work out in your favor, depending on the circumstances.   

In order to understand splitting assets, you must first have a clear understanding of what is considered separate property and what is considered marital property.  

Key Takeaways

Separate Property

Generally speaking, separate property is a property you owned prior to the marriage or property that came to you via gift, will, or decent. If the property was purchased by you and remains in your name throughout the marriage, with no comingling, then that property is not subject to division. If someone gave you, and only you,  a gift of property during the marriage and you did not comingle it, that is separate property and not subject to division. If you inherit property through a will probate, it is separate property unless you bring it up. Finally if you get property from a deceased relative without a will, by decent, that is your separate property unless you comingle it.   

Marital Property

Generally speaking any assets or debts acquired during the length of the marriage could be considered marital and be subject to equitable division in a 50/50 state. Even if one spouse makes the purchase it is still an asset acquired during the marriage. If separate property gets comingled with marital property the court could treat it as marital property. 

Comingling

Comingling occurs when certain steps are not taken to keep the property separate. An example of this would be a spouse inheriting money from a relative via will, which is a separate property at that time and is not subject to division. The spouse then takes that inherited separate property and uses it to renovate the marital home. The property is now comingled, and it is unlikely that the court will back out of the separate property when dividing the marital estate. One pitfall that married couples often stumble upon is refinancing. If one spouse wants to refinance their separate property home, many times, the refinance company will claim that both party's names must go on the financial agreement, and that causes comingling, making it unclear if the intent of the spouses to keep the property separate or if the property is now a marital asset subject to division. Another example is if a spouse receives money via inheritance and then deposits the money in a joint account, making it accessible to the other spouse, that does not show an intent to keep the money as separate property.  

50/50 State

In a state that uses the community property approach or "50/50," any assets or debts acquired during the marriage are considered marital and subject to equitable division. The 50/50 rule is the default, but the parties can agree to a different division of property if they can come to an agreement. In a 50/50 state, equal division is the default, but if the parties desire something else and agree on it, the court will ratify the division as they agree.  

Equitable Division State

In a state that uses equitable division, the court will examine each party's contributions to the marital estate and divide accordingly while considering the circumstances of each case brought before it. Equitable division is not a get out of jail free card for the higher earning spouse, the court may elect to award the lower income spouse more based on their situation, the duration of the marriage and other factors. The court does not automatically give assets to the higher earning spouse.  

Pre or post-nuptial agreement

The simplest way to address the division of assets that will work in any jurisdiction is to have an agreement in writing dictating who gets what. As long as each party has adequate time to review a proposed pre or post-nuptial agreement, the court should enforce it. The prenup is the most common document, and it is completed prior to marriage, but parties can also do a postnup at any time during the marriage. Provided that the documents are not signed under duress and each party has time to thoughtfully review the document with the assistance of counsel, the agreement will be enforceable. This is the surefire method to prevent a long-winded battle about the division of assets and debts in the event of a divorce.  

Can You Divorce Without Splitting Assets? 

If you have an agreement in writing, then you should not have to split assets during a divorce. If you do not have a prenup or a postnup, some division may be necessary, depending on how much you actually have. Sometimes, the parties were married for a short time and didn't really have any assets to divide. If there is no agreement in place and there are assets and debts from the marriage, they have to be divided. No one can simply walk away with everything in a divorce without the other spouse's consent. If you want to avoid division, keep everything separate and have a prenuptial agreement in place.  

Can You Split Assets Without Getting a Divorce? 

You can split assets without a divorce. The key to splitting assets without a divorce is the consent of the other spouse. If both spouses agree to split assets, it will need to be in writing, especially if the property is real estate. It would be best to have an attorney draft the agreement to split assets; something informal between the parties could very easily be challenged in a court of law. The best approach is to make sure that there is nothing about the situation that looks like one spouse is putting unethical pressure on the other spouse. Another pitfall to avoid is a rushed agreement; both parties should have time to consult their own separate attorney and give the agreement a thoughtful review. If done properly, parties can agree to split assets without getting a divorce.