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Wisconsin Property Division
Property Distribution Laws in Wisconsin

In Wisconsin the courts generally accept a fair and reasonable property division the parties agree to, but if the parties cannot agree, the Circuit Court divides the marital estate within the Judgment of Divorce.

Factors in Equitable Distribution

A community property state, Wisconsin uses dual classification of marital and separate property, and the appreciation of separate property is separate. The Circuit Court divides the marital estate when the spouses cannot. Equitable means fair, not necessarily equal.

In dividing property, the court does not consider marital misconduct. According to Wisconsin Statutes - Sections: 766.01, 766.97, 767.255, the court considers:

  • the duration of the marriage;
  • the property brought to the marriage by each party;
  • whether one of the parties has substantial assets not subject to division by the court;
  • the contribution of each party to the marriage, giving appropriate economic value to each party’s contribution in homemaking and child care services;
  • the age and physical and emotional health of the parties;
  • the contribution by one party to the education, training or increased earning power of the other;
  • the earning capacity of each party
  • the desirability of awarding the family home or the right to live therein for a reasonable period to the party having physical placement for the greater period of time;
  • the amount and duration of an order granting maintenance payments to either party, any order for periodic family support payments and whether the property division is in lieu of such payments;
  • other economic circumstances of each party, including pension benefits, vested or unvested, and future interests;
  • the tax consequences to each party.
  • any written agreement made by the parties before or during the marriage concerning any arrangement for property distribution;
  • such other factors as the court may in each individual case determine to be relevant.

Marital Property vs. Separate Property

In Wisconsin, property acquired or earned during the marriage is marital. Property that belongs only to one spouse before marriage is separate. Separate property also includes gifts or inheritances.

A spouse must prove that his or her claim of separate property is true because Wisconsin courts treat all property as marital. Proof means demonstrating that separate property was not mixed with marital property or used for community purposes. When the court accepts that property is separate, the property remains separate. This property cannot be awarded to the other spouse; it is not part of the community property.

Valuing and Dividing Property

First, the court classifies assets and liabilities, property and debt, as marital or separate. Then it assigns a monetary value to the marital property and debt. Finally, it distributes the marital assets between the two parties an equitable way.

The Marital Home

In Wisconsin, as in many jurisdictions, the equity of the marital home is often one of the biggest marital assets. The equity is the market value of the house, less any liabilities against the property, such as a mortgage, taxes, or home equity loans. Normally, making this calculation requires a paid real estate appraisal or a real estate agent can prepare a market analysis for free.

From there, couples choose one of three options to divide the equity:

  • The spouses sell the home and divide the proceeds.
  • One of the parties may refinance the home and “buy out” the other party.
  • One spouse (usually the custodial parent) remains in the home with the exclusive use and possession for a certain period of time (for example, until the youngest child graduates from high school), then either buys out the other spouse or sells the home and divides the proceeds.

Pensions and Retirement Accounts

Several different methods of valuation are used in determining how much a marital asset is worth, depending upon the asset to be valued and the level of agreement between the parties. Courts generally accept the value when the spouses mutually agree on a value of a particular asset. Experts may be retained by the parties or by the courts to determine the value of marital assets if the parties cannot agree. Such experts may include accountants, real estate or business appraisers, or pension valuators. The use of experts adds to the cost of the divorce.

The presumption in Wisconsin is that all property, including retirement accounts, are divided equally. For most retirement accounts - 401(k)'s, pension plans, or IRA's - the parties agree to a Qualified Domestic Relations Order (QDRO). This instrument divides these accounts. For some retirement accounts, such as military, state or county pension plans, QDRO's do not apply and other special orders are required.

In Wisconsin the court may include the retirement benefits and plans earned by both spouses as marital assets available for division. Retirement benefits vary greatly but can generally be divided into two groups:

  • Defined Contribution Plans: A defined amount of money belonging to the employee. The employee and/or the employer make defined contributions. The balance of the plan is constantly changing, but its value is definable at any given point. 401(k)’s, 403(b)’s and profit sharing plans fall into this category.
  • Defined Benefit Plans: A retirement benefit where an employer promises to pay a benefit to an employee sometime in the future, based upon some type of formula. Normally, this formula is based on the employee’s salary near the end of his or her career and the number of years he or she worked for the employer before retirement. Defined benefit plans are much more complicated to value and often require the professional evaluation of an actuary to determine exact values.

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