In our last post, we began a discussion about the ways in which professional degrees obtained during marriage (or sometimes shortly before marriage) are treated in New York divorce cases. Because New York considers professional licenses and degrees to be marital property, addressing their value can prove to be a truly complex property division issue during divorce disputes.
The challenges surrounding treatment of professional degrees as property during divorce are so complex, numerous and arguably unfair in some cases that many attorneys and other interested parties are asking the state legislature to modify its approach during the next legislative session.
Of particular concern is the fact that treating degrees as property has led to very inconsistent property division settlements in various cases. These inconsistencies often result in drawn-out proceedings and may lead to unfair outcomes in more cases than not, especially in cases involving significant assets.
In an effort to level the financial playing field for individuals who may not earn as much money as their spouse, New York has long attempted to enforce the concept of marriage as a financial partnership through equitable distribution regulations. The goals of these laws may be noble, but their practical applications are inconsistent and often unjust.
For example, if a person's degree is valued at a certain amount and he or she is required to hand over half of that value to his or her former spouse, the professional spouse may be locked into their profession forever just to stay afloat economically. For example, it is difficult to stop practicing law and start your own cupcake shop if you are expected to pay extremely high amounts of alimony due to the value of your degree.
Hopefully the legislature will seriously consider its treatment of professional degrees during divorce in the next legislative session. Failure to do so will only lead to repeated inconsistencies and injustice throughout the system.
Source: Wall Street Journal, "After Divorce, a Degree Is Costly," Sophia Hollander, Dec. 23, 2012