Property that is deemed non-marital in an Illinois divorce cannot be divided. But, what if that property has increased in value during the marriage? Does the increase in value during the marriage make the property marital? Is the increase in value, itself, marital property because it came into existence during the marriage? Under 750 ILCS 5/503(a)(7), the increase in value of non-marital property remains non-marital, regardless of what caused the increase. However, the marital estate may be entitled to reimbursement under 750 ILCS 5/503(c)(1)(A)(ii) if marital funds or a spouse’s personal effort contributed to that non-marital asset’s appreciation. This reimbursement must be proven with clear and convincing evidence. Is The Property Marital Or Not? When dividing assets in an Illinois divorce, the court’s first step is to determine what property is marital and what property is non-marital. “The court shall make specific factual findings as to its classification of assets as marital or non-marital property, values, and other factual findings supporting its property award.” 750 ILCS 5/503(a) Non-marital property is not divisible under Illinois law and will always remain with the owner after the divorce. “[T]he court shall assign each spouse’s non-marital property to that spouse.” 750 ILCS 5/503(d) Marital property, in contrast, must be allocated by an Illinois divorce court. An Illinois divorce court “shall divide the marital property without regard to marital misconduct in just proportions” 750 ILCS 5/503(d) A party who owns an asset will quickly argue that the asset is non-marital and, therefore, not divisible by an Illinois divorce court. “[T]he following…which is known as “non-marital property”: (1) property acquired by gift, legacy or descent or property acquired in exchange for such property; (2) property acquired in exchange for property acquired before the marriage; (3) property acquired by a spouse after a judgment of legal separation; (4) property excluded by valid agreement of the parties, including a premarital agreement or a postnuptial agreement; (5) any judgment or property obtained by judgment awarded to a spouse from the other spouse except, however, when a spouse is required to sue the other spouse in order to obtain insurance coverage or otherwise recover from a third party and the recovery is directly related to amounts advanced by the marital estate, the judgment shall be considered marital property; (6) property acquired before the marriage, except as it relates to retirement plans that may have both marital and non-marital characteristics; (6.5) all property acquired […]
