There are a few instances where non-marital property is converted into marital property. This can occur when the non-marital property is retitled from one spouse’s name into both spouses names (i.e. real estate). This also happens when commingling, the combining of marital and non-marital assets, occurs and the value of the marital and non-marital assets becomes indistinguishable. This commonly occurs when spouses open a joint bank account and add non-marital funds to the account. In both retitling and commingling situations the entire value of the property is converted into marital property.
The other type of conversion occurs when the value of a non-marital asset is enhanced due to the martial labor or financial contribution of either spouse during the marriage. An enhancement through martial labor occurs quite frequently with closely held businesses and must be considered for business valuation purposes. Improvements to non-marital assets with marital funds (i.e. home improvements) would cause a percentage of the total value of the asset to be marital.
If you have concerns regarding the conversion of an asset from a non-martial property to martial property you should enlist the services of a forensic accountant. Contact us for help at www.consultac.com.
