A closer look at asset division in Wisconsin divorce

On Behalf of | Mar 7, 2022 | Property Division

When any couple gets divorced, the terms of their divorce are set by the laws of the state in which they file (unless they have an existing prenuptial agreement in place). While there is considerable uniformity among state divorce laws, there are also some important differences that could greatly impact the outcome of your divorce – especially regarding property division.

Most states in the country follow what’s known as the “equitable distribution” model of property division. Wisconsin is one of just nine states that uses the “community property” model. We’ll discuss the differences between the two in this post, and what to expect in your own Wisconsin divorce.

The two property division models

In a state that recognizes the equitable distribution model, courts are required to divide assets and debts equitably in divorce, which isn’t always the same as equally. When deviating from a 50-50 split, each state’s laws outline the relevant factors that may be considered in making that decision. These could include factors like each spouse’s economic and non-economic contributions to the marriage, the length of the marriage and the earning capacity of each spouse.

In Wisconsin, a community property state, all property, whether owned prior to or acquired during the marriage AND regardless of whether the property is titled individually or jointly, is considered divisible property in Wisconsin. It is presumed in Wisconsin that property will be divided equally; however, there are factors outlined in Wis. Stat. 767.61 that the court can consider when determining whether a deviation from an equal division is appropriate.

There are also some exceptions to what is considered divisible property in Wisconsin

While most property acquired prior to or during after the marriage is considered divisible, there are some notable exceptions. These can include:

  • When one spouse received an inheritance during the marriage, such as property/assets bequeathed in a will or through a trust fund and the inheritance has not been co-mingled with other non-inherited or gifted assets.
  • When one spouse received property/assets as a gift and it was understood that only one spouse was the beneficiary of that gift and the gift has not been combined with other non-gifted or inherited assets.

Why it’s important to work with a good attorney

While the community property model is conceptually easier than the equitable distribution model, it doesn’t automatically allow for much nuance regarding each spouse’s financial stake in a given asset. Thankfully, an experienced attorney can help you fully catalog and properly value all assets, then determine whether a petition for a deviation from an equal division of property is appropriate, considering the specific facts of your case.