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How do divorce courts handle retirement accounts?

by | Apr 13, 2021 | Family Law |

If you have an upcoming divorce, you are no doubt thinking about how the court will divide your assets. Like most Americans, your retirement account is probably one of your most valuable assets, and you might wonder whether half of it will go to your spouse or whether you’ll get to keep it.

Division of property in Washington

Washington is a community property state. This means that courts first classify all of your property as either marital (community) property or separate property. Then they generally will divide the marital property equally between the spouses.

Washington law directs courts to follow an equitable distribution strategy when deciding how to divide the community property. What this means is that the court will look at a list of factors when deciding which assets each spouse should receive. These factors include each spouse’s earning capacity, education level and health, among other things.

An important thing to note is that the court will treat marital property differently from individual property. The court will usually only divide the marital property. Your separate property will remain yours exclusively after the divorce — unless the court finds a compelling reason why they need to divide your separate property in the interests of justice.

Retirement accounts

In general, anything you owned before you got married is separate property, while things you obtained after your wedding day are marital property. There are some exceptions to this rule, however.

When it comes to retirement accounts, courts will break down the total amount in the account based on when you earned it. The portion of the account you earned before you got married will remain separate property. Anything you added to the account while married is marital property and is thus fair game for negotiation and division.

You worked hard to accumulate your retirement account, and it can be extremely frustrating to think of a large portion of it going to your spouse during your divorce. But knowing exactly how much the court is likely going to be able to divide will allow you and your attorney to have a complete picture when it comes to negotiating asset division with your spouse’s attorney.