Divorce is never easy, especially when valuable assets like investment properties are involved. Deciding who gets these properties is frequently contentious, and to avoid prolonged legal battles, you need to understand how to handle this division.
Assessing the property’s value
First, get the current market value of the investment properties. Hire a professional appraiser for an accurate valuation. This helps ensure a fair division of property and that both parties understand the property’s true worth.
Determining marital vs. separate property
Next, figure out if the properties are marital or separate property. If the property came into possession during the marriage, it is marital property. In Tennessee, marital property must be divided. Separate property, acquired before marriage or through inheritance, usually stays with the original owner.
Evaluating contributions and income
Look at each spouse’s contributions to the properties. This includes financial investments, management, and improvements. Also, consider the income generated and its use during the marriage. This helps decide a fair split and recognizes each spouse’s involvement.
Considering tax implications
Tax implications are important in property division. Transferring ownership can lead to taxes like capital gains. Consult a tax professional to understand these impacts and make informed decisions to avoid unexpected costs.
Negotiating a fair settlement
Once all assets are valued, negotiation can occur. There are several ways to deal with an investment property, including one spouse buying out the other, selling the properties and splitting the money, or trading other assets.
Dividing the investment properties can be a stressful, time-consuming process. However, understanding these steps helps reduce some of the stress and makes the process easier to handle.
