How Are Commingled Assets Handled in an Illinois Divorce?

Posted on in Divorce

Northwest Cook County divorce attorney asset division

Often found in the business world, commingled assets refer to mixing personal funds with business funds or using business assets for personal reasons. Commingling of funds or assets can also occur between two spouses, making it difficult to determine which funds and/or assets belong to whom in a divorce. For example, it can be hard to distinguish when one spouse’s separate property is mixed with the other spouse’s marital property. However, this is crucial to ensure that each party receives his or her fair share of the marital estate. 

Equitable Distribution 

Under Illinois law, marital property is divided using the equitable distribution method, which means items or assets are not necessarily split in half, but rather in a fair way. Marital property is generally considered property that was acquired during the course of the marriage. Non-marital or separate property is that which one spouse owned prior to getting married or acquired during the marriage through gift or inheritance. Separate property is not subject to division in the divorce settlement. 

Mine Versus Yours

Commingling can take place when one spouse uses marital funds to maintain, enhance, or contribute to separate property. For instance, a house that you purchased by yourself before your marriage is your separate property. If you get married after you purchased your home, and later use marital funds to pay the mortgage, or make improvements to upgrade it, your spouse gains an interest in the home’s value. Because the house has been mixed in or transmuted with the marital assets, it may be classified as marital property instead of separate property during a divorce. Another example is when funds from one spouse’s bank account are put into a joint savings account with the other spouse. These funds then become marital property and are therefore subject to division if the marriage ends in a divorce.

The best way to prevent commingling is by creating and signing a prenuptial agreement (prenup). A prenup designates who gets what in case a couple decides to divorce. These legally binding documents are enforced regardless if spouses commingled their property. A postnuptial agreement can also address this issue if a prenup was not originally drafted. In Illinois, the spouse claiming that a certain asset is non-marital has the burden of proof. This typically requires a comprehensive investigation of financial records and assistance from a legal professional or accounting expert to prove something is not eligible for division.

Contact a Hoffman Estates Divorce Attorney

Asset division can be one of the most complicated and difficult parts of finalizing a divorce settlement. Commingled assets can be especially challenging to figure out what to do with during negotiations. At The Law Office of Nicholas W. Richardson, we have handled all different kinds of divorce cases, ranging from amicable to highly contentious and complex. Our accomplished Inverness divorce lawyer is ready to assist you with your unique situation. To schedule a free consultation, call us today at 847.873.6741. 




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