Just like the assets a couple had during their marriage must be divided in a divorce, debts accrued must also be divided. And while many people understand that obvious debts, such as vehicle payments and credit card bills, will be divided during the divorce, many people may not realize that medical debt will be divided as well.
Tennessee is an equitable distribution state, meaning all marital property (assets and debts incurred during the marriage) will be divided fairly during a divorce, which may only sometimes be an even split. However, there are certain factors that the Courts will review when determining who will get what assets and how marital debt will be divided.
Medical debt can be a significant issue during a divorce in Tennessee. Therefore, it’s essential to understand who is responsible for paying the medical debt in a divorce and how it’s split between the spouses.
Marital Property vs. Separate Property
The first thing that the court will determine is if the medical debt is considered marital property or separate property.
What is Marital Property?
As a general rule, if medical debt is incurred during the marriage or throughout the divorce process, it’s considered marital property, and it is the responsibility of both parties in the divorce.
An example of a medical debt that would be considered marital property is if the wife had a baby during the marriage. Although the bill would be solely in the wife’s name, both spouses benefited from the medical debt, so it would be considered marital debt.
When determining who will be responsible for paying marital debts, the courts will consider the following factors.
- How long have you been married
- Age and health of each spouse
- Future earning potential of both spouses
- The purpose of the debt
- Which spouse benefitted from the debt
- Each spouse’s ability to pay the debt
What is Separate Property?
Separate property belongs to only one spouse, and it isn’t part of the property division in a divorce. That means that if one spouse had medical debt coming into the marriage, that debt is solely their responsibility. It also means that if a spouse incurs medical debt after the couple has separated, that spouse is responsible for that debt.
For example, let’s say the husband had an outstanding medical bill from a hospital stay before marriage. The medical bill would be considered separate property.
Exceptions Regarding Medical Debt in Tennessee
There are some exceptions to equitable distribution laws in Tennessee. For example, if you had a prenuptial agreement that specifically addressed medical debt, the debt would be allocated per the terms of the agreement.
Another exception would be if you and your spouse took out a loan together to consolidate the medical debt. In this instance, both parties are still responsible for the debt. The debt may also fall under equitable distribution if marital funds were used to pay the bill, despite which spouse’s name is on the bill, and if the medical debt would be considered separate property otherwise.
Another way to avoid Tennessee’s equitable distribution laws is by working with your spouse and submitting a separation agreement laying out how the debt will be divided between the two of you. This typically happens via both sides’ attorneys communicating to agree on who will be responsible for the debt.
Once you agree, that document will be presented to the judge for final approval. If you are unable to come to an agreement, the debt will be divided by the judge.
Medical Debt for Children in Tennessee
What happens to medical bills for children that the couple share? Any medical bills that occurred for the children during the marriage are considered marital debt, and the debt will be divided per Tennessee’s equitable division laws.
However, if the medical bills were after the divorce, the responsibility would be determined by the child support order issued by the court. Typically, the children will be included on the parent’s insurance policy with better coverage. After the insurance company pays the medical bills, the child support order will resolve any remaining medical debt.
Contact Attorney Hunter Fowler, a Murfreesboro Attorney Who Listens
Determining who is responsible for paying the medical debt in a divorce in Tennessee can be complex. It’s essential to understand the general rule that medical debt incurred during the marriage is considered marital property and is divided between the spouses in a divorce.
However, there are exceptions to this rule, and the court will consider several factors when dividing medical debt in a divorce. If you’re facing a divorce in Tennessee, seeking the assistance of an experienced divorce attorney is essential.
Attorney Hunter Fowler is a Murfreesboro attorney who will help you navigate the complex issue of dividing medical debt during a divorce in Tennessee. He will listen to you, provide valuable guidance on the division of medical debt and help ensure that your rights and interests are protected during the divorce process.
Contact us today for a consultation.