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This guide explains the basics of property and debt division in a divorce. Property division can be complicated, so you may want to talk with an attorney.
How does the court divide property and debt?
In a divorce or legal separation, the Court will divide marital property and debt. When the Court divides marital property and debt. The court tries to divide things fairly - not necessarily equally.
What is property?
Property is anything you own. Property can be physical items like houses, cars, appliances, and household items. Property can also be non-physical items like stocks and bonds.
What is marital vs. non-marital property?
Marital property includes most assets and debts acquired during the marriage, regardless of whose name is on the title or account.
- Homes, vehicles, and bank accounts bought during the marriage
- Retirement accounts and pensions earned while married
- Debts incurred while married (credit cards, loans, etc.)
Note:
Even if only one spouse earned the income or signed the loan, it’s usually considered marital if it happened during the marriage.
What is non-marital (separate) property?
Non-marital property belongs to one spouse and is generally not divided in a divorce. Non-marital property can include:
- Property owned before the marriage
- Gifts or inheritances received by one spouse during the marriage
- Assets protected by a valid prenuptial or postnuptial agreement
Important!
If separate property is mixed with marital assets—like depositing inheritance into a joint account or adding a spouse to the deed of a house—it may become marital property.
If the court finds that a certain property is separate (non-marital), it cannot give that piece of property to the other spouse and it cannot order the other spouse to sell the non-marital property.
What about growth in value?
Certain non-marital property (such as equity in houses or the value of investment accounts) may grow in value during the marriage. The increase in value (called “appreciation”) during the marriage is marital (joint) even if the property itself is technically separate property.
In this situation, you would need to show the court what the property was worth when you got married and what it is currently worth. The increase in value would be marital and could be divided during the divorce.
- For example, let’s say Spouse A purchased a house 2 years before the marriage At the time of purchase, the house was worth $100,000. The house grew in value during the parties’ 15-year marriage and at the time of divorce, it was worth $500,000. Because the home is separate property, the court cannot give Spouse B the house or order that Spouse A sell the house. However, the $400,000 growth in value during the marriage ($500,000-$100,000) is marital property and Spouse A will need to compensate Spouse B for this growth in value.
How does the court know what property and debt you have?
You and your spouse will each be required to fill out a form and tell the court what property and debt you have. The form you fill out is called JDF1111: Sworn Financial Statement.
In addition to this form, you must share financial documents with the other person. These documents include:
- Tax returns for the last 3 years;
- The most recent statement for every bank/financial institution account;
- Income documentation for each source of income in the current and prior calendar year;
- Health insurance documentation for the minor children;
- Most recent statement of any personal and/or joint debt; and
- Childcare cost documentation.
More documents may be required.
List everything with the court: It is important to let the court know about all your assets and debts, even property you want to keep or debt you plan to pay yourself. If you have separate property, tell the court. If you have debts in your name only, tell the court. The court will not do its own research. It only knows what you tell it.
If you have a house, you may need to get it appraised. If you leave something out, the division of property could be challenged later.
How does the court decide what is fair?
In Colorado, courts divide marital property using a principle called equitable distribution. This means the division should be fair—not necessarily equal. Judges consider several factors to decide what’s fair based on each couple’s unique situation.
Tip:
Marital fault or misconduct is not considered when dividing property.
Key factors the court considers
1. What each spouse contributed
- Includes income, homemaking, childcare, and support of the other’s career.
- Non-financial contributions are valued equally to financial contributions.
2. What separate property each spouse has
- The court looks at what each person already owns separately.
- This helps balance the division of shared assets.
3. What each spouse’s financial situation will be after divorce
- Judges consider each spouse’s financial outlook after the divorce.
- This includes income, debts, and ability to support themselves.
- If one spouse will have primary custody of children, they could be awarded the family home, but this does not always happen.
4. Changes in value of separate property
- If one spouse’s separate property increased or decreased in value during the marriage, the court may factor that in.
- If a spouse used separate property to support the marriage, the court can consider this.
- For example, if one spouse used a significant portion of their inheritance to help the other spouse attend school and earn a degree, the court can consider this when dividing marital property.
5. Wasted or hidden assets
- If one spouse wasted or hid marital assets, the court may adjust the division.
How to think about property and debt together
When the court tries to divide marital property, it will consider all property and debt together. Think of it like math. Property is a plus. Debt is a minus.
- Example: A couple has $50,000 in marital property and $20,000 in marital debt.
- Spouse A gets $35,000 in property and all $20,000 in debt → ends up with $15,000
- Spouse B gets $15,000 in property and no debt → ends up with $15,000
Even though Spouse A got more property, they also got more debt. The result is fair.
What happens if my ex doesn’t pay a debt?
Even if a divorce judge says your ex is responsible for a certain debt, that doesn’t change how lenders or credit card companies see it. If the debt is in your name and your ex doesn’t pay, the lender can still come after you for the money. You have legal options against your ex for failing to pay the debt they were ordered to, but dealing with creditors is stressful, takes time, and can hurt your credit score.
Because of this, you may want to consider taking responsibility for the debt in your name. Whether it is fair and practical to do this will depend on your overall financial situation.
Tip:
The court can divide property and debt fairly, but the court cannot change whose name is connected to a debt. The court can order which spouse must pay a debt, but the court cannot order the debt collector to only collect from the person who is given the debt in the divorce. If a debt collector sues you for a debt awarded to your former spouse, see How to Enforce a Court Order in a Family Law Case for more information.
How is retirement divided in divorce?
Marital vs. Separate Portions
Contributions to retirement made during the marriage are marital property and subject to division.
Contributions made before the marriage are usually considered separate property and not divided.
Just like a home, if a retirement plan grows in value during the marriage, this increase in value or appreciation is considered marital property and can be divided by the court.
Tip:
You may need a financial expert to help calculate the marital share of a retirement account or pension.
Common types of retirement accounts
Courts can divide many types of retirement benefits:
- 401(k), 403(b), and other employer-sponsored plans
- IRAs (Traditional and Roth)
- Pensions and defined benefit plans
- Military and government retirement benefits
Important!
Some plans have special rules or protections, such as PERA, military and federal pensions.
What is QDRO?
To divide certain retirement accounts—like a 401(k) or pension—you’ll need a Qualified Domestic Relations Order (QDRO). A QDRO is a court order that tells the retirement plan administrator how to split the account.
It allows the transfer without taxes or penalties.
You’ll need a lawyer or specialist to draft it correctly.
Tip:
A QDRO is separate from your divorce decree and must be approved by the retirement plan.
Ways the court can divide retirement?
Courts may divide retirement in different ways:
- Split the account: Each spouse gets a portion.
- Offset with other assets: One spouse keeps the account, and the other gets something of equal value.
- Deferred division: The account is divided when benefits are paid out in the future.
Tip:
Dividing retirement and pensions can be very complex. You can potentially hire or consult with an attorney just for this piece of your case. There are attorneys who specialize in the division of retirement or pensions.
Need more help?
If you are low-income, a senior, or a veteran, you may qualify for free legal help from Colorado Legal Services (CLS). To apply or ask if you might qualify, go to the CLS website and find the office that serves your area. If you call or visit, CLS can help you in your native language.
You can get help from the courts. Every judicial district has staff called “Sherlocks” to help people with their legal questions. To find the Sherlock in your county, visit the Judicial Department’s Sherlock webpage.