When couples divorce, they have to make critical decisions on the terms that will apply to the termination of their marriage, including issues of child custody, child support, spousal support, and property division. Understandably, the division of assets is one of the most contentious issues couples face, as their hard-earned assets are at stake. While couples usually don’t make a fuss about dividing items like living room furniture, determining how to split valuable investments like rental properties can make the process all the more challenging. Please continue reading to learn how your rental properties may be divided during a divorce and how a trusted Bristol County Division of Assets and Debts Lawyer can help you navigate this complex process.
What are the options for dividing rental properties in a Massachusetts divorce?
Knowing whether your rental properties are considered marital or separate property is imperative when divorcing. If accumulated during the marriage, they would be considered marital assets and subject to equitable distribution. With that in mind, the following options for dividing these assets in Massachusetts are available:
- Continue renting and split the proceeds. If you rely on your rental properties as your primary income source or do not want to sell them for tax reasons, you may bite the bullet and continue renting them with your former spouse. If you agree to continue to rent out the property, you will have to devise a business plan which stipulates the responsibilities of each party to manage the properties and how the income will be divided. If this option seems favorable, but you do not want to keep such close contact with your former spouse as you still harbor negative feelings toward them, you could benefit from creating a partnership agreement. It will protect your interests and allow you to keep some distance from your former spouse while successfully managing the properties.
- Split the properties. If you and your spouse own more than one rental property, you may devise a plan to split the properties, with each spouse taking full ownership of their share of a particular property. This way, you can still earn a living off of the property you take full ownership of. However, to make this option work, you must determine how to divide the properties fairly so that each party receives an equivalent value. Unfortunately, this option can be challenging as you may own an odd number of properties, and they likely will not hold the same market value.
- Buy out your spouse. If you are the driving force behind your rental properties, you may want to keep them. An option that would allow you to keep your rental properties is buying out the other. If your spouse is willing, you can buy their share of the rental properties to obtain full ownership to continue renting them out and receiving an income. However, this option can be costly as you must buy their share to own it fully.
- Selling and dividing the proceeds. Another option that may come as no surprise is selling the rental properties and splitting the sale proceeds. Typically, couples cannot decide how to divide their property, let alone valuable investments like rental properties. Therefore, if you and your spouse cannot agree on how to split them, the court will likely order you to sell them, and the proceeds will then be fairly divided between each party. This option is particularly beneficial for couples that want a clean break to begin their new life.
Before you decide how to handle your rental properties, contact an adept lawyer from The Law offices of Cynthia L. Hanley, P.C., who can help you determine the best option for your needs.
