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What happens to marital property in another country during a divorce?

What happens to marital property in another country during a divorce?

Going through a divorce is rarely an easy process, but when Illinois couples have many assets it can become even more challenging. An Arlington Heights divorce lawyer knows that state, federal and international law all require divorcing couples to split up their marital property as fairly as possible, but when those assets are held in more than one country it can be extremely complex to find, value and divide up the property.

There are many reasons why a couple may own property overseas. One or both spouses may have dual citizenship, they may have lived abroad together or they may have created an international business that has holdings in multiple locations. Regardless of the purpose for owning marital property in another country, a couple must deal with the cultural differences, varying laws and red tape that often accompany dividing assets abroad.

Property division basics

In Illinois, the court is required to follow equitable distribution laws when dividing a couple’s marital property. Rather than distributing 50 percent of all assets to each spouse, a judge must decide what is just and fair. The courts look at a wide range of factors when determining what each spouse should receive, including the following:

  • The length of the marriage
  • The contributions of each spouse
  • The ages of each spouse
  • Each spouses’ ability to earn an income

In some cases, a spouse who willingly left the workforce to raise children may be awarded a greater share of an estate than the spouse who is better able to continue earning the same income after the dissolution of a marriage.

Couples who only have property that is within the state of Illinois do not have to worry about the laws of other states or countries. They are only required to follow the statutes that their own lawmakers have put in place to provide guidance for the property division process.

Deciding where to file for divorce

When it comes to filing for divorce, a couple with international property must decide the country in which they would like to file. An Arlington Heights divorce lawyer knows that the outcome of a divorce can vary drastically depending on the country that claims jurisdiction over a divorce case. In general, couples may find it slightly easier to work through a divorce following United States or European laws. Some other countries, especially in North Africa or the Middle East, tend to favor husbands significantly, which can make it difficult for wives to receive fair treatment when ending a marriage.

While spouses should decide together where they want to file for divorce, it is also a good idea to hire legal assistance in each location to ensure that the procedures are handled correctly on each end. If spouses cannot come to an agreement of where to file, the first person to file typically gets to have his or her say as to where the divorce will take place.

Why the type of property matters

Although the international community has put great effort into making the judicial process surrounding divorces with international times more streamlined, it can still be complicated. The Hague Conference on Private International Law has nearly 75 member countries, and there are guidelines in place regarding how jurisdiction over marital property is determined. Generally speaking, the type of property that a couple owns is the deciding factor of which country’s property division laws have to be followed.

Real property, including homes, land and investment properties, is often subject to the laws of the country in which it is located. A vacation home, for example, would have to be divided between the divorcing spouses according to the division requirements put forth by the country’s jurisdiction, regardless of whether husband or wife is a citizen of that country. On the other hand, financial holdings and personal property are typically subject to the laws of the country in which the divorce was filed.

Locating and valuing foreign assets

In Illinois, a spouse may request discovery if he or she suspects that the other spouse is hiding assets. This can make it easier to find property that has been accounts within the United States, but offshore accounts may be more difficult to discover. Some countries have strict privacy laws in place that can be virtually impossible to get through, especially without legal assistance. An Illinois judge may order a party to divulge foreign assets, but it may still be a challenge to enforce that order overseas.

If an asset is discovered, it must be valued in order for division to take place. In the U.S., couples normally hire a valuation expert or appraiser to provide a professional assessment of how much a piece of property is worth. If the property is question is subject to a foreign country’s laws, however, it may be valued differently than it would be in the United States.

Enforcing property division orders overseas

Even if both spouses agree on how property is valued and how it is to be divided, enforcing a property division can still be tricky when dealing with a foreign government. Many countries may not enforce a U.S. court order for property division, and vice versa. Additional paperwork may be required to prove that the order is valid and should be followed.

In order to complete the property division process, many couples choose to work with an Arlington Heights divorce lawyer who has experience dealing with the paperwork and documentation required to finalize international property transfers. Travelling abroad may be required, along with patience as attorneys attempt to coordinate with domestic and foreign courts.

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