Under Minnesota law, property division is based on a just and equitable division of assets and liabilities between two spouses. In short, the property “equalizer” payment is what one spouse owes the other spouse after all of the assets and liabilities have been divided in order to achieve this just and equitable award.
Whether a property equalizer is necessary in your case will depend on many factors, including whether there is a home with significant equity that is awarded to one spouse. This is generally the most valuable asset and, awarding it to one spouse does often result in an equalizer payment. This payment will effectively reimburse the spouse who is not awarded the home for his/her share of the marital equity. However, if neither spouse can afford to pay the equalizer payment and reimburse the other spouse for his/her share of the marital equity in the home, many parties choose to simply sell the home and equally divide any net profits.
Some spouses also agree that a property equalizer payment will be made in installments, in order to lessen the financial burden on the paying spouse.
To learn more about how a property equalizer payment is calculated, read our blog about balance sheets here.
If you have any questions about a property equalizer, please call me today at 651-647-0087 or reach out via our online contact form to set up your free consultation.