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What Counts as Marital Property?

April 22, 2024

A key issue in every divorce is determining how to divide marital property. Connecticut has a broad definition of what counts as marital property that encompasses just about everything a couple owns together or separately. That property is subject to equitable distribution which means both spouses have rights to the assets in divorce, although those rights might not be equal.

What Property is Subject to Equitable Distribution in Connecticut?

Connecticut law (C.G.S.A. § 46b-81) does not differentiate between marital and separate property the way some states do. All assets that are owned by the parties at the time of the divorce are subject to equitable distribution regardless of how and when they were acquired and how they are titled unless a prenuptial or post-nuptial agreement states otherwise. 

As a result, assets you brought into the marriage like your savings account, an inheritance, investments, an interest in a business, or other property will be considered by the court in divorce. The same is true of any income or property acquired during the marriage, such as stock options and pensions. Importantly, even if deferred compensation rights have not fully vested at the time the divorce is filed, they may be subject to equitable distribution.

What Does the Court Consider in Dividing Property in Divorce?

Just because all assets are subject to equitable distribution does not mean that they are all divided or that they are divided equally. Connecticut law requires that the court consider the following factors in equitable distribution:

the length of the marriage, the causes for the annulment, dissolution of the marriage or legal separation, the age, health, station, occupation, amount and sources of income, earning capacity, vocational skills, education, employability, estate, liabilities and needs of each of the parties and the opportunity of each for future acquisition of capital assets and income. The court shall also consider the contribution of each of the parties in the acquisition, preservation or appreciation in value of their respective estates. 

CT Gen Stat § 46b-81 (2019).

Notably, courts have the discretion to weigh each factor as appropriate depending on the facts and circumstances of the case. 

How Can You Protect Property from Equitable Distribution?

A prenuptial or post-nuptial agreement allows the parties to designate how assets will be treated in the event of a divorce or the death of one spouse. For example, the agreement can provide that assets owned by a party before marriage as well as gifts, inheritances, and trust distributions that are received by one spouse during the marriage are not subject to equitable distribution. This includes any appreciation in the value of such assets that may occur during the marriage.

Trusts can also be used to preserve assets for children from another marriage or to protect a family business interest and/or generational wealth. However, depending on the terms of the trust, a prenuptial or postnuptial agreement may still be advisable.

Our attorneys have extensive experience addressing diverse financial issues and assets in the context of prenuptial agreements, postnuptial agreements, and in the event of divorce. Contact us to learn how we can help you.

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