In dealing with property for married spouses, the date of separation is also known as the valuation date. Assets and debts are valued as of that date, as well as the date of marriage as part of the equalization process.
With few exceptions, equalization is intended to make the financial impact to each party over the course of the marriage equal. At times, there may be a material differences in the parties’ respective circumstances from a financial perspective and therefore the Financial Statements are prepared in order to determine each party’s net family property, which is the difference between the spouse’s financial position on the date of marriage and the date of separation with few exceptions.
There are some assets that are excluded from the calculation of a spouse’s net family property, including:
An equalization payment is 50% of the difference between the spouses’ respective net family properties.
There is a limitation period (time limit) for equalization claims of six years from the date of separation or two years from the date of divorce, whichever comes first.
If you have questions regarding equalization claims, please speak to us – we’re here to help clarify how this might pertain to you.
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