Wisconsin’s marital property law became effective on January 1, 1986. The law was enacted to formally recognize that both spouses contribute to a marriage even though only one may earn an income. Under the marital property law, whatever the couple acquires during the marriage belongs to them equally, regardless of whose name is on the title. This applies not only to earned income, but also unearned income such as interest and dividends. For example, if one spouse has a 401(k), and over time the account’s value grows as a result of additional contributions, as well as interest and dividends generated by the securities held in the account, the other spouse has an equal marital interest in the account even though it is actually titled only in the contributing spouse’s name. It is important to note, however, that marital property law applies to a couple’s debt and liabilities in the same manner as it does their property.
Marital property law applies to a couple as of their “determination date.” The determination date is the earliest of 1) the date of marriage, if both spouses are Wisconsin residents; 2) the date both spouses become Wisconsin residents after moving here, or 3) January 1, 1986, if the couple was married before that date. This does not mean, however, that all property automatically becomes marital property as of the couple’s determination date. Marital property law presumes that all assets are marital property, unless it can be documented that the asset is one spouse’s “individual” property. Individual property is property that belonged to one spouse before the couple’s determination date, or property that was gifted to, or inherited by, one spouse after the determination date. Whether or not individual property stays individual property depends on what that spouse does with it. If individual property is mixed with marital property, it will usually become marital property. For example, if one spouse deposits the check he or she received as an inheritance into the couple’s joint investment account, the individual property will probably become marital property.
Because Wisconsin’s marital property law controls the ownership of a couple’s assets, it affects every element of their finances. It is particularly important for couples in a second marriage, or that have a blended family, to understand how the law affects their situation. The only means by which a couple can truly change the effect of the law or avoid the law entirely is a marital property agreement. A marital property agreement is usually signed before a couple marries, but can also executed after the marriage. For a comprehensive evaluation of Wisconsin’s marital property law, it is best to obtain the assistance of legal counsel.Like this article? Please share it: