Highlights

  • Minnesota is not a community property state. Minnesota law provide for an equitable division of marital property rather than an equal division. The division may be equal, but it does not have to be under state law.

  • Marital property is the term for any property that is considered jointly owned. Separate property is the term for assets that remain separate during a marriage.

Personal Property and Division in a Divorce

Splitting assets or physical property during a divorce can be a fraught process, particularly if you and your spouse aren’t on the best of terms. Let’s cover the basics of Minnesota marital property laws.

What Is A Community Property State?

A community property state is a state in which the law provides that all marital property is divided equally between spouses during a divorce proceeding. This means, in effect, that each spouse is presumed to own an undivided, one-half interest in the property.

So Is Minnesota a Community Property State?

Minnesota is not a community property state.

In Minnesota, the law provides for an equitable division of marital property rather than an equal division. Put another way, an equitable division of property may mean that it is equal – but it does not have to be equal. 

Given the Minnesota property division statute, it is entirely possible for one spouse to be awarded more than half of the marital property if the circumstances surrounding the dissolution justify that being the result.

The List of Community Property States in the U.S.

Community property laws are the minority in the United States. Currently, these are the only community property states in the U.S:

  • Arizona

  • California

  • Idaho

  • Louisiana

  • Nevada

  • New Mexico

  • Texas

  • Washington

Minn. Stat. § 518.58, Subd. 1, provides the following with respect to the factors that Minnesota Courts rely on when making determinations on how property is divided:

  • the length of the marriage

  • any prior marriage of a party

  • age, health, station, occupation, amount and sources of income, vocational skills, employability, estate, liabilities, needs, opportunity for future acquisition of capital assets, and income of each party

  • the contribution of each in the acquisition, preservation, depreciation or appreciation in the amount or value of the marital property, as well as the contribution of a spouse as a homemaker.

Additionally, the same Statute states that, “It shall be conclusively presumed that each spouse made a substantial contribution to the acquisition of income and property while they were living together as husband and wife.”

This means that even if a spouse did not work during the marriage and did not have income, it is presumed that he or she made a substantial contribution to the household, and that spouse is therefore entitled to an equitable division of the marital property. Many individuals believe (wrongly) that because they were the primary earner, that their spouse should receive less than them during a property division. 

This assumption is false and not warranted under Minnesota law. 

Other factors must be considered when determining how marital property is divided, including the transfer, concealment, or dissipation of marital assets from one spouse, and non-marital property –generally, this is property acquired prior to the marriage. Nonmarital property is also called separate property.

Property division in Minnesota is a complex endeavor, especially if either spouse has non-marital claims, it is a long-term marriage, and/or if a claim is being made that one spouse contributed more to the acquisition and preservation of the marital estate. 

So Then, What Property Is Subject to Division?

The list of real and personal property subject to capture by one or both spouses is extensive.

  • Real estate purchased during the marriage

  • Income earned by either spouse during the marriage held in bank accounts (checking and savings accounts) cash, collectibles, or otherwise

  • Investment accounts contributed to during the marriage, including retirement accounts (401Ks, IRAs, etc.) and pensions that accrued value during the marriage will be considered marital property

  • Furniture and household items purchased during the marriage, called real property

  • Vehicles purchased during the marriage

  • Jointly held debts, like mortgages, car loans, and credit card debts

real estate during divorce

What Is Separate Property?

Separate property in the context of a divorce refers to assets that belong solely to one spouse and are not subject to division during the divorce proceedings.

This contrasts with marital or community property, which is acquired by the couple during their marriage and is considered jointly owned. The distinction between separate and marital property can significantly affect the division of assets in a divorce.

Separate property usually has one of two characteristics under Minnesota law: it was acquired before the marriage or has a particular carve-out when received during a marriage. Separate property might (but doesn’t always) include:

  • Property owned before marriage: Assets owned by either spouse before they got married usually remain the separate property of that spouse.

  • Inheritances and gifts: Property or money inherited by one spouse, or gifts given specifically to one spouse during the marriage, are often considered separate property, even if acquired during the marriage.

  • Personal injury awards: Compensation received from personal injury claims (e.g., for physical injuries) is sometimes deemed the separate property of the injured spouse.

  • Property acquired after separation: Assets acquired by a spouse after the couple has legally separated can be considered separate property.

  • Property designated as separate in a prenuptial or postnuptial agreement: The power of a prenuptial! Couples can agree on what property is considered separate through legal agreements – this is the best way to protect assets during marriage and are often used for second marriages or marriages later in life.

Here’s an important distinction: Commingled property is separate property that has been mixed or combined with marital property and may be considered marital property. For example, if one spouse’s premarital savings are deposited into a joint account and used for marital expenses, those funds might now be considered marital property.

Talk to An Experienced Minnesota Family Law Attorney for Peace of Mind

If you’re facing a contentious Minnesota divorce or are worried about marital property division, our team can help you understand the process and navigate just and equitable division with care.

If you would like to know more about property division in Minnesota, talk to an experienced Minnesota family law attorneytoday by giving us a call at 952-800-2025 or reach out via our online contact form to set up a free consultation.

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