The Equitable Distribution State:
How Property is Divided in an Indiana Divorce
A common question in divorce matters involves how property will be divided. A secondary question is what property is subject to division. This blog will help you understand what may be included in the marital estate, how it’s valued, and how an Indiana court may divide the property
What is Marital Property?
Marital property in Indiana means all assets and debts owned by either spouse, regardless of when they were acquired or how they are titled, as of the date the petition for dissolution is filed (“date of filing”). In Indiana, there is no such thing as “non-marital” property
What counts as marital property? Everything.
Indiana follows the “One-Pot” theory. Everything that existed as of the date of filing, both assets and debts, goes into the pot to be divided. Indiana law provides that the court shall divide all property of the parties, regardless of whether the property was:
• Owned by either spouse before the marriage;
• Acquired by either spouse in their own right after the marriage but before the final
separation; or
• Acquired by their joint efforts.
There are no exceptions. Many litigants are surprised to find that property owned before they were married, or assets received via inheritance or gift, are included in the pot. An inheritance is something an individual may receive from a deceased family member, for example. A gift can be a sum of money or even property given to you by a friend or family member. It does not matter whose name is on the title; if either party (or both) owned it on the date of filing, it is marital property. For example, if a vehicle is titled in one spouse’s name alone, it is still part of the marital estate and subject to division by the court. Vested pensions are also part of the marital estate, regardless of whether the participant is receiving those funds or has access to them. Additionally, all debts and/or liabilities, like credit card or student loan debt, are included in the marital estate.
How is the marital estate valued?
The date a spouse files for divorce is known as the “date of filing.” The marital estate ‘freezes’ and a snapshot is taken of the value of all assets and debts, regardless of how they’re titled, as of the date of filing.
There are exceptions to the date of filing rule. Indiana law allows a court to value an asset as of any date between the date of filing and the date of the final hearing. Certain assets, such as retirement or investment accounts, can fluctuate in value due to no fault or actions by either party. The court can choose to which value is most appropriate to use when valuing the marital estate, at its own discretion.
To value the marital estate, discovery (written questions and requests for documents) is often exchanged by parties. Many counties also require the parties to exchange financial declarations. Financial declarations are forms which require the parties to declare their income, expenses, and the value of assets and debts on the date of filing.
You can help your attorney by having bank statements and other financial documents representing your assets and debts on the date of filing. If you do not have them, consider contacting your bank, credit card company, tax preparer, retirement plan administrator, etc. to request those statements. Doing so will save your attorney time, which saves you money in fees.
The 50/50 Presumption
The court considers any relevant factor in determining whether a deviation is appropriate, so it is important that you talk to your attorney. However, there are statutory factors that a court will consider to determine whether deviation from an equal division would be just and reasonable:
• Contributions: The contribution by each spouse to acquiring the property, regardless of whether their contribution actually produced income. Contributions may include the actual financial contribution to the acquisition of property, or non-financial contributions, like taking care of and maintaining property.
• How the Property was Acquired: The extent to which the property was acquired by each spouse either before their marriage or through inheritance or gift. Inheritance could be a family home which was received from the estate of a deceased family member. A gift, for example, could be a sum of money given to a spouse which was used to purchase the marital residence or even a vehicle.
• Economic Circumstances: The economic circumstances of each spouse at the time the property will be divided, including the earnings from the property division as well as the spouses’ earning ability. Additionally, the court will look at “the desirability of awarding the family residence or the right to dwell in the family residence for such periods as the court considers just to the spouse having custody of any children.” This means a court may consider awarding the marital residence to the spouse that has primary physical custody of the children.
• Conduct by the Parties: The court will consider the conduct of the parties during the marriage relating to the disposition or dissipation of property. This may include conduct by a spouse to hide marital property or dispose of it before the divorce is finalized in an attempt to prevent the other spouse from either discovering the property or from receiving it.
It’s unusual for a court to deviate beyond a 60/40 split. However, there have been instances of 80/20 splits affirmed by the Indiana Court of Appeals.
How is the property actually divided?
The court can order that property be divided in any number of ways. The court may:
• Divide the property in kind (split the asset);
• Set the property or parts of the property over to one party and require the other to pay a
“just and proper” amount in gross or in installments;
• Order the sale of the property and divide the proceeds in a manner prescribed by the court; or
• For certain retirement accounts or pensions that are payable after the marriage is dissolved,
the court can order the benefits be divided by awarding a party a percentage of those payments.
Common misconceptions about property Division:
• It’s in my name, so it’s mine. Title does not matter. If it existed on the date of filing, it goes into the marital pot and is subject to division.
• My spouse cheated, so I get more. Not necessarily. Indiana is a no-fault state and typically does not consider infidelity in dividing the marital estate. However, a court may deviate from a 50/50 split if marital funds were spent on the affair, which would potentially be a dissipation of the marital estate.
Frequently Asked Questions (FAQs)
Is Indiana a 50/50 State?
Yes, as a starting point. A 50/50 split is presumed to be fair, but a court can deviate to award more than 50% of the property to a spouse by looking at contributions, how property was acquired, the economic circumstances of the parties, or the conduct of the parties related to the disposition or dissipation of marital property.
What happens to the house?
That depends. It could be sold, or one party may get to keep it. If it’s awarded to one party, they are often required to refinance the mortgage and make a payment to the other party for their portion of the equity in the home. If they can’t refinance the mortgage, the court may order that it be sold.
Do I get a share of my spouse’s retirement?
If it exists on the date of filing, it’s part of the marital pot. Whether or not you get a share depends on how the marital estate is divided. Retirement accounts (e.g., 401ks, IRAs) and vested pensions accrued during the marriage are marital property.
WHat about the debt we accumulated?
Debt goes into the marital pot and is subject to division just like assets.
Can assets be hidden?
Hiding assets is strictly prohibited and can lead to severe penalties.
Can my share be protected?
Talk to your attorney about how property in the marital estate was purchased or acquired. This includes if there are assets you would like to retain.
There is no “one-size fits all” answer to this question and it is largely dependent on the facts of your case. The more information you give your attorney, the more they can help.
How long does the process take?
This is hard, if not impossible, to predict. Indiana has a 60-day waiting period before divorce can be finalized. Depending on the size of your marital estate and the issues involved, a ‘simple’ case might take 3 to 6 months or longer. Complex estates can take a year or longer.
What i we agree on how our property shouLd be divided?
Marital estates are often divided through agreements by the parties and are granted by a court so long as they are just and reasonable. Parties often reach agreement as a result of negotiation and/or through mediation. Some Indiana counties require parties to attend mediation prior to final hearing on the division of the marital estate.
There are many benefits to dividing property by agreement rather than court order. Court can be costly and stressful. Agreements, on the other hand, allow the parties to be flexible and retain some authority and control on how the marital estate is divided (like choosing to keep your pension in exchange for the other party getting the house).
The division of marital property is a fact-dependent inquiry with substantial “gray areas.” If you have questions about protecting your future, speak with an experienced Indiana divorce lawyer.
Written by: Samuel Crawford
Sam is an Associate Attorney at Brown Carrington, PLLC, in the firm’s Indianapolis office. A first-generation college graduate and the first attorney in his family, he brings a strong work ethic and deep commitment to client advocacy.
He earned his undergraduate degree with honors from Indiana University and his Juris Doctor from the Maurer School of Law, where he served as a judicial intern for the Vanderburgh County Superior Court. Before joining the firm, Sam practiced in estate planning and elder law, handling guardianships and other contested matters.
Sam is dedicated to providing thoughtful counsel, clear communication, and effective courtroom advocacy to help clients navigate complex legal issues with confidence.
Learn more about Sam here.
Edited by: Catherine Pierce
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