When a marriage ends, the division of property often becomes one of the most contentious elements of the divorce process. In New Jersey, an equitable distribution state, marital assets are not necessarily split 50/50—but rather in a manner the court deems fair.
This process becomes particularly challenging when dealing with commingled assets. These assets began as separate property (belonging to one spouse) but were later mixed with marital property, making their original source unclear. The question is: Is it possible to track commingled assets during a New Jersey divorce?
Tracing commingled assets
To determine whether a commingled asset can be excluded from division, the spouse claiming it as separate property must trace the asset. This means providing clear and convincing documentation that shows where the asset came from and how it was used. This may involve:
- Bank and investment account statements
- Real estate purchase documents
- Records of gifts, inheritances or settlements
- Testimony or affidavits explaining the source of funds and their usage
Suppose a spouse received $100,000 from a family inheritance before the marriage and used it as a down payment on a home now jointly owned. In that case, that spouse would need to provide bank records and home purchase documents to argue that a portion of the home’s equity should remain separate.
Challenges in tracing
Tracking commingled assets is not always straightforward. Over time, accounts are often used for multiple purposes, such as:
- Paying bills
- Saving for emergencies
- Investing
If separate and marital funds were frequently mixed without documentation, the burden of proof becomes difficult to meet. Courts in New Jersey require clarity, and if a judge cannot easily determine the origin and usage of the funds, they may rule the asset entirely marital.
Yes, tracking commingled assets during a divorce is possible—but it requires effort, organization and dedicated legal support. Spouses who are concerned about protecting separate property or navigating asset division can also work with a trusted forensic accountant to trace the origins of their assets.