A distributive award is a payment or series of payments one spouse makes to another during a divorce. Payments for a distributive award do not come from marital property.
Instead, they distribute separate property from one spouse to another. Why would the court order this? Consider the circumstances that may lead to a distributive award.
When does the court make distributive awards?
One reason for a distributive award during divorce proceedings is in response to one spouse’s misconduct, such as hiding assets. The purpose is not to punish the offending spouse. Instead, a distributive award may be the best means to ensure a fair division of assets.
Sometimes the court will order a distributive award in cases where the division of marital property is more complex, and the distributive award would make it easier. For example, large asset divorces are sometimes difficult to divide because one or both parties do not want to liquidate. To settle the issue and make the division of property as fair as possible, the court may order one spouse to buy out the other.
What factors does the court consider?
Factors the court will consider before ordering a distributive award include the duration of the marriage, the number of assets and debts, the liquidity of property and the tax consequences of dividing certain assets. The best interests of children are also a top priority. This comes into consideration when deciding what to do with the family home.
Distributive awards are often a more agreeable option for everyone involved, especially in complex cases.