Is Nebraska a Community Property State? The Cornhusker State’s Marital Property Laws, Explained!

No, Nebraska is not a community property state. Instead, Nebraska follows the system of equitable distribution when dividing property in a divorce. This means marital assets are divided fairly, but not necessarily equally, between the divorcing parties. Forget the 50/50 split you might hear about in community property states – Nebraska takes a more nuanced approach. Let’s delve into what that actually means for you.

Understanding Equitable Distribution in Nebraska

Equitable distribution isn’t about simply splitting everything down the middle. The courts in Nebraska consider a variety of factors when determining what’s “fair.” Think of it as a customized approach designed to recognize the unique circumstances of each marriage.

Key Factors in Equitable Distribution

Several factors influence how a Nebraska court will divide marital property:

• Contribution of Each Party: This isn’t just about who earned the most money. The court considers the contributions each spouse made to the marriage, whether financially or through homemaking, childcare, or supporting the other spouse’s career. A stay-at-home parent’s contributions are valued just as much as the breadwinner’s.
• Dissipation of Assets: If one spouse recklessly spent or wasted marital assets (think gambling debts or lavish gifts to a paramour), the court may take this into account and award the other spouse a larger share.
• Value of Separate Property: While separate property (assets owned before the marriage or received as gifts or inheritance during the marriage) generally remains separate, its value can impact the overall equitable distribution. If one spouse has significant separate property, they might receive a smaller share of the marital estate.
• Economic Circumstances of Each Party: The court looks at the earning potential, job skills, and overall financial situation of each spouse after the divorce. The goal is to ensure that both parties can become self-supporting.
• Length of the Marriage: Longer marriages often result in a more equal division of property, recognizing the shared life and intertwined finances of the couple.
• Interruption of Personal Careers: If one spouse sacrificed their career for the benefit of the marriage or the other spouse’s career, the court may consider this in the property division.
• Any Other Relevant Factor: The statute allows the court to consider anything else relevant to achieving a fair and equitable outcome. This catch-all provision ensures that no important details are overlooked.

Separate vs. Marital Property: Knowing the Difference

Understanding the distinction between separate property and marital property is crucial.

• Separate Property: This generally includes assets owned by a spouse before the marriage, or received during the marriage as a gift or inheritance. However, separate property can become marital property if it is commingled with marital funds or used for the benefit of the marriage.
• Marital Property: This includes all assets acquired by either spouse during the marriage, regardless of whose name is on the title. This can include real estate, bank accounts, investments, retirement funds, and personal property. Any increase in value of separate property during the marriage due to marital efforts may also be considered marital property.

The Role of a Prenuptial Agreement

A prenuptial agreement (or premarital agreement) can significantly alter the default rules of equitable distribution. A valid prenuptial agreement allows a couple to decide in advance how their property will be divided in the event of a divorce. This provides certainty and control over the outcome, but it’s essential that the agreement is entered into voluntarily, with full disclosure, and with independent legal counsel for each party.

Frequently Asked Questions (FAQs) about Nebraska Marital Property

These FAQs address common concerns and provide further clarity on Nebraska’s property division laws.

1. What is “commingling” of assets, and how does it affect property division?

Commingling occurs when separate property is mixed with marital property to the point that it becomes difficult to distinguish. For instance, depositing an inheritance (separate property) into a joint bank account used for marital expenses can transform that inheritance into marital property. To protect your separate assets, keep them separate.

2. How are retirement accounts divided in a Nebraska divorce?

Retirement accounts accumulated during the marriage are generally considered marital property and are subject to equitable distribution. A Qualified Domestic Relations Order (QDRO) is typically used to divide these assets without incurring tax penalties.

3. Does it matter who filed for divorce first in Nebraska regarding property division?

No, it doesn’t. Nebraska is a no-fault divorce state. This means that the court doesn’t consider which spouse filed first or who is “at fault” for the breakdown of the marriage when dividing property. The focus is solely on achieving a fair and equitable outcome based on the factors mentioned above.

4. What happens to jointly owned property, like a house, in a Nebraska divorce?

Jointly owned property, like a house, is considered marital property. The court can order the property to be sold and the proceeds divided, or it can award the property to one spouse, who may need to compensate the other spouse for their share of the equity.

5. If I owned a business before the marriage, is it considered marital property?

Not necessarily. The business itself might remain your separate property, but any increase in its value during the marriage due to marital efforts or contributions may be considered marital property subject to equitable distribution. A business valuation is often required to determine the value of the business and the portion attributable to the marriage.

6. How does debt get divided in a Nebraska divorce?

Debt acquired during the marriage is treated similarly to assets. The court will equitably divide the marital debt between the spouses. This doesn’t necessarily mean a 50/50 split, but rather a fair allocation based on the circumstances of the marriage.

7. What if my spouse hid assets during the marriage?

Hiding assets is a serious issue in a divorce. If you suspect your spouse is concealing assets, it’s crucial to gather evidence and bring it to the court’s attention. The court can impose penalties on a spouse who attempts to hide assets, including awarding the other spouse a larger share of the marital estate.

8. Can a divorce decree be modified regarding property division after the divorce is finalized?

Generally, property divisions are final and cannot be modified after the divorce decree is entered. There are very limited exceptions, such as fraud or mistake, but these are difficult to prove. This underscores the importance of ensuring that the property division is fair and accurate during the divorce proceedings.

9. How does a court determine the value of personal property, like furniture and jewelry?

The court may rely on various methods to determine the value of personal property, including appraisals, estimates from retailers, and the spouses’ own testimony. For items with significant value, such as jewelry or artwork, a professional appraisal is often necessary.

10. What is the difference between alimony (spousal support) and property division?

Alimony, or spousal support, is a separate issue from property division. Alimony is intended to provide financial support to one spouse after the divorce, based on factors such as the length of the marriage, the earning potential of each spouse, and the standard of living during the marriage. Property division is the division of assets and debts acquired during the marriage. Although both issues impact a person’s financial wellbeing post-divorce, they are different considerations for the court.

11. Do gifts I received during the marriage become marital property?

Gifts received by one spouse individually during the marriage are generally considered separate property, unless they were intended for both spouses. However, this can depend on the context and how the gift was treated during the marriage.

12. Is it necessary to hire an attorney to handle a property division in Nebraska?

While it’s not legally required, hiring an experienced attorney is highly recommended, especially if there are significant assets or complex financial issues involved. An attorney can protect your rights, ensure that the property division is fair, and guide you through the legal process. Navigating property division can be complex and emotionally charged, so having legal expertise on your side can be invaluable.

This information is for general guidance only and not a substitute for legal advice from a qualified Nebraska attorney. Every case is unique, and the specific laws and facts of your situation will determine the outcome. It’s crucial to consult with a legal professional to understand your rights and options.