How Are Assets Divided in Michigan During a Divorce?
By Beverly Bird
In community property states, the law demands that courts divide marital property 50/50 when couples divorce. In equitable distribution states, judges may stray from a 50/50 split when they believe circumstances warrant it. Michigan is an equitable distribution state, but judges typically divide assets fairly evenly. Courts will order a more disproportionate division, for example, more than 60/40, only in extreme situations. If you don't want to leave it up to a judge, Michigan allows spouses to reach their own agreement and submit it to the court. Judges will generally honor a couple's wishes regarding property distribution unless their pact is egregiously unfair to one spouse or the other.
Equitable Distribution Factors
Michigan is a no-fault state so spouses can’t file for divorce on any grounds other than the breakdown of the marriage, but when it comes to dividing property, judges may consider what caused the marriage to break down. The concept of equitable distribution allows courts to weigh certain factors when deciding if a 50/50 division of marital assets is appropriate and Michigan is one of a few states that will consider marital fault. If one spouse has ended the marriage by committing adultery or abusing the other, it would not be equitable to reward him with additional marital property in a divorce, depriving the innocent spouse of a 50 percent share. Michigan judges also consider which spouse contributed more income to the acquisition of marital assets. The spouse who contributed more income might deserve more than a half share of the property because his labor made its purchase possible.
Read More: How Do You Get Equitable Distribution Enforced in a Final Decree of Divorce?
Income Vs. Household Labor
The issue of which spouse contributed more financially to the acquisition of marital assets can be tricky in Michigan, especially in long-term marriages. Michigan law acknowledges that “reliance on the marriage” may cause a spouse to sacrifice career opportunities in favor of remaining out of the workforce to care for the couple’s home and family. The stay-at-home spouse might have less earning potential and would therefore contribute less financially to the purchase of marital assets. However, courts usually won’t penalize her because of this, depriving her of a fair share of marital property when the marriage ends. She may even receive more than 50 percent, because she’s not likely to be able to learn job skills post-divorce to replace property as easily as her spouse might. However, exceptions exist. In short-term marriages where one spouse elects not to work because the other earns sufficient income to support them, her household contributions probably would not factor into asset division. Courts strive to return each spouse to his or her premarital financial condition after short marriages, assigning each of them the property they brought into the marriage and dividing everything else evenly.
Property as Spousal Support
In divorces where one spouse is unlikely to be able to support a lifestyle comparable to what she enjoyed during the marriage, Michigan courts may award her more property in lieu of spousal support. For example, she may receive the marital home because it’s unreasonable to expect her to pursue a career after 25 years of marriage if she rarely or ever worked -- she would be unlikely to earn enough to replace that home. A judge might give her the property, even if this means that she’ll receive 55 percent or 60 percent of the total value of the couple’s assets overall. This usually occurs when the other spouse has an active career and is more likely to be able to purchase or lease suitable accommodations of his own.
Transmutation of Separate Property
Normally, Michigan law protects a spouse’s separately owned property from distribution in divorce. However, when a separately owned asset appreciates in value over the years, some judges will divide the appreciation in a divorce. This is especially true when transmutation has occurred, such as when one spouse contributed “sweat equity” to a home owned by the other before the marriage. This typically occurs when a spouse helped to maintain or improve the property over the years and her labor likely contributed to its increase in value. This transitions the separate property into marital property. Michigan courts will generally reward her for her efforts by giving her a share of the asset's increased equity.
Beverly Bird is a practicing paralegal who has been writing professionally on legal subjects for over 30 years. She specializes in family law and estate law and has mediated family custody issues.