When we get divorced here in Des Moines or anywhere in Iowa, we need to figure out how to distribute property of the marriage. Although it would be tempting to just divide everything right down the middle, that would not necessarily be fair. For example, if one party has never worked and has low earning potential the Judge may determine it is equitable to award them more property. Property that is gifted to or inherited by a spouse are not subject to equitable distribution, meaning you get to keep them if you were the recipient or you inherited and are not required to share them with your spouse, see Iowa Code Section 591.21(6).
Factors the court considers in distributing property in Iowa dissolution cases:
Iowa courts consider the contents of pre-nuptial agreements, but they are not bound by them., see In Re Spiegel, 553 NW2d 309.
Property brought into the marriage is subject to equitable distribution, See In Re Sullins, 715 N.W. 2nd 242.
Pensions are subject to equitable distribution, see In re Branstetter, 508 N.W. 2nd 638.
Social Security and Veterans Benefits are NOT subject to distribution, they are kept by the beneficiary. See divorce and social security benefits.
See Iowa Equitable Distribution in Divorce, Iowa Code Section 598.21 and In Re Dean, 642 N.W. 2nd 321. However, equal distribution is not required, see 2013 Iowa State Bar Association Family Law Update.
Marital Debt in Des Moines Iowa
Married Iowan’s often have both joint debt like home and car loans and individual debt like credit cards or medical bills. Since Jeff handles Iowa bankruptcy too we deal with these issues daily. See Jeff’s Divorce & Bankruptcy page.
Attorney fees ordered paid by the opposing party to divorce are not discharged in bankruptcy.
Banks are not a party to your Iowa divorce
The first thing to remember is that your creditors are not parties to your divorce. So if the Iowa district judge rules for example that the husband is responsible for a car loan that is in both your names, that alters your obligation to each other but it does not alter anyone’s obligation to the creditors. Hence, if the party does not make the car payment as required, the lender can still pursue both parties.
This is one reason that people going through divorce will often file bankruptcy, since they are still obligated to lenders on debt even after an Iowa judge orders the other spouse to pay it. Of course if the other party is ready, willing and able to pay it, that is great.
If one party discharges joint debt in bankruptcy, the lender will often pursue the other party for the debt. They can do this even though the Iowa divorce court ordered their x-spouse to pay it. This is because the lender was not a part of the divorce proceeding and is not bound by the courts order.
Some people attempt an "end run" around this issue by inserting a provision in the divorce decree that neither party may file for bankruptcy. The federal courts do not recognize the provisions, so they do not keep the party from filing bankruptcy anyway.
Equitable Distribution applies to Debt too
Iowa judges attempt to distribute debt in an equitable way as well. The Judge will consider similar factors as in distributing property including earning capacity and assets available to each party.
Some people going through divorce in Iowa do have significant equity in the home. Most Iowan’s do not have the cash laying around to pay the other spouse their share of the home equity, although if you do that is one option for resolving this issue. Periodic payments or a lump sum once the home is sold or when the youngest child reaches 18 are options as well.
Iowa courts do like to keep kids in the homestead if possible, so if one parent has primary physical custody and can reasonably afford the home, that is often preferred.
In other cases, the parties agree to sell the home and split the proceeds or the Court orders an equitable distribution of the proceeds.
QDRO – Dividing Pensions
If a spouse is awarded part of the other parties pension, a QDRO is the document that is prepared to arrange for the holder of the pension to pay part of the benefits to the 2nd party. See QDRO law information.
Health Insurance for Children
Iowa courts want the minor children of divorce to get medical care. So your decree will often include a requirement that either the petitioner or respondent provide health insurance for the children and may address who is responsible for out of pocket medical costs as well.
College Costs for Kids
Iowan’s do not want young people to miss the opportunity to attend college due to a divorce, so decrees often include provisions for the petitioner and respondent to share the costs of higher education. See Divorced parents and college tuition.
Maintaining Life Insurance after Iowa Divorce with Children
If you have kids, it is wise for both parties to maintain life insurance so the surviving spouse and children are protected. Iowa judges often include this requirement in orders and the parties are expected to provide proof of life insurance to the other each year. Term life insurance is quite affordable.
Additional Resources on Distribution of Property in Des Moines Iowa Divorce
See Iowa State Bar/Property Distribution., Iowa District Courts, Wikipedia on Dissolution Custody and Support. Iowa family law forms are available online. Polk County District Court/Google. See Child Custody and Divorce in Iowa.