The term "splitting up" is an appropriate one to describe the end of a marriage; during the divorce process, both marital property and marital debt must be split between the spouses. The manner in which a family law court divides property and assets in a divorce -- including money market accounts -- depends on the state in which the couple lives.
The most efficient way for a couple to divide assets and debts is to negotiate an agreement between them that the court includes in the divorce order. Some couples can work things out across a dining room table, while others do better working with a neutral third party as a mediator. Regardless of how the arrangement is achieved, a negotiated marital settlement agreement avoids a contentious trial and saves attorney fees. If you are able to settle your divorce issues, you can decide together who gets the funds in your money market account.
Spouses that are unable to agree on the division of their property and debt must present their arguments to the judge, who resolves disputes according to the law of the state where the couple resides. Most states have adopted one of two principal types of property division systems: community property and equitable distribution. The property division system used by your state helps determine how your money market account is split between you and your spouse when you divorce.
In states that have adopted community property laws, like California, New Mexico, Texas and Washington, assets are classified as either separate property or community property. Money earned during the marriage by either spouse, as well as anything purchased with those earnings, is considered community property and must be divided equally between divorcing spouses. Separate property includes property acquired by a spouse before marriage or bequeathed or gifted to one spouse during marriage. Each spouse is awarded her separate property in a divorce.
Most states that do not have community property laws use a system termed equitable distribution to split the property of divorcing spouses. The goal of this system is to achieve a fair division of property, not necessarily a 50/50 split. All marital property and debt must be equitably split between the spouses, and courts typically have authority to allocate the separate property of one spouse to the other if necessary to make the final division fair to both.
Money Market Account
A money market account is a liquid bank account that pays a higher rate of interest than a regular checking account. In a divorce in a community property state, a money market fund is part of the property to be divided equally between the spouses if the money is community property; the funds may be divided equally or given to one spouse if the other spouse receives an asset of equal value. It may also be assigned to one spouse if it is the separate property of that spouse. In an equitable distribution state, the judge may award the fund to either spouse or split it between the two depending on the other assets and debts of the couple.