In a Florida divorce, an asset can remain one spouse’s nonmarital property, while some of its increase in value is divided between both spouses. The outcome depends on why the asset appreciated, whether marital funds or either spouse’s labor contributed to the increase, whether the asset was commingled with marital property, and whether a valid agreement changes the ordinary Florida rules. The question is: When does an increase in value remain with one spouse, and when does the other spouse get a share?
Is the Property Marital or Nonmarital?
Before a Florida court can determine who receives an asset’s increase in value, it first must determine whether the underlying asset is marital or nonmarital. A Florida divorce court must “set apart to each spouse that spouse’s nonmarital assets and liabilities.” Fla. Stat. § 61.075(1).
The remaining marital assets are subject to equitable distribution. The court begins “with the premise that the distribution should be equal,” although it may order an unequal distribution when justified by circumstances laid out in the statute. Fla. Stat. § 61.075(1).
Generally, property acquired during the marriage is presumed to be marital property. Under Florida law, “[a]ll assets acquired and liabilities incurred by either spouse subsequent to the date of the marriage and not specifically established as nonmarital assets or liabilities are presumed to be marital assets and liabilities.” Fla. Stat. § 61.075(8).
Just because one spouse’s name appears on the deed, account, or business documents does not automatically make an asset nonmarital. Property acquired during the marriage can be marital regardless of how it is titled.
In Florida, nonmarital assets include:
- Assets acquired before the marriage and assets acquired in exchange for those assets;
- Assets received separately by one spouse through a gift from a person other than the other spouse, inheritance, bequest, devise, or descent, and assets acquired in exchange for those assets;
- Income derived from nonmarital assets unless the spouses treated, used, or relied upon that income as a marital asset; and
- Assets excluded from the marital estate by a valid written agreement, such as a prenuptial or postnuptial agreement.
Fla. Stat. § 61.075(6)(b).
For instance, a house purchased by one spouse before the marriage is typically that spouse’s nonmarital property. Or, an ownership interest inherited from a parent is typically nonmarital property.
If a spouse claims that an asset acquired during the marriage is nonmarital, that spouse must prove that the asset falls within one of Florida’s statutory exceptions.
Joint ownership can make that argument harder. Florida law presumes that real, personal property held by spouses as tenants by the entireties is marital property, even if the property was acquired by one spouse before the marriage. The spouse claiming that some or all of the jointly titled property stays nonmarital must overcome the presumption by clear and convincing evidence. Fla. Stat. § 61.075(6)(a)2.-4.
Deciding that an asset is nonmarital does not always end the court’s inquiry. The underlying asset may stay as one spouse’s nonmarital property while the increase in the asset’s value is classified as marital property.
Florida law includes within the marital estate “[t]he enhancement in value and appreciation of nonmarital assets resulting from the efforts of either party during the marriage or from the contribution to or expenditure thereon of marital funds or other forms of marital assets, or both.” Fla. Stat. § 61.075(6)(a)1.b.
In other words, marital labor or money spent on nonmarital property does not necessarily turn the whole property into a marital asset. Only the enhancement or appreciation attributable to the marital contribution may be subject to equitable distribution.
In Martin v. Martin, the wife inherited a forty-acre parcel during the marriage; the property remained titled only in her name, and “the title was never changed.” 923 So. 2d 1236, 1237-38 (Fla. 1st DCA 2006). So, the court held that “based upon the plain language of the statute, the property was nonmarital.” Id. at 1238. That classification did not change simply because marital funds paid the property taxes or the husband made improvements to the land during the marriage. Id. The court reasoned that “improvements or expenditures of marital funds to a nonmarital asset” do not transform the entire asset into marital property; instead, only the resulting “enhancement in value and appreciation” may become marital. Id. at 1238-39.
The trial court found that the property was worth $80,000 at the time of the divorce, yet it did not determine its value when the wife acquired it or the amount by which it had appreciated during the marriage. Id. at 1239. Further, the court did not determine what portion of any appreciation was attributable to marital funds or either spouse’s labor. Id. Florida law requires “specific findings as to the value of such enhancement and appreciation during the marriage,” as well as the portion attributable to marital contributions. Id. Since the trial court did not make any of these findings, “the record before us [did] not support an award of enhancement in value.” Id.
Thus, a spouse may retain the underlying nonmarital asset while still being required to share an increase in value caused by marital funds or efforts.
Active Appreciation Versus Passive Appreciation
Florida courts distinguish between appreciation due to marital efforts and appreciation due to external forces.
Active appreciation occurs when either spouse’s labor, management, or investment decisions contribute to the increase in value. Because the increase resulted from efforts made during the marriage, it may be classified as marital property. Fla. Stat. § 61.075(6)(a)1.b.
Passive appreciation usually results from market conditions, inflation, or the work of independent third parties, not from the efforts of either spouse. In Naranjo v. Ochoa, the wife invested $830,000 of an advanced inheritance in four mutual funds through a buy-and-hold strategy. 366 So. 3d 11, 12-13 (Fla. 4th DCA 2023). The investments appreciated by $892,687.94, yet the parties made only the four initial purchases and did not actively trade the funds during the marriage. Id. at 12-13, 17-18. The court held that the appreciation was nonmarital because the increase came from passive appreciation and the work of the mutual fund managers instead of marital efforts by either spouse. Id. at 17-18.
Purely passive appreciation typically remains nonmarital. However, Florida applies a separate statutory rule when marital funds reduce the mortgage principal on nonmarital real property. Fla. Stat. § 61.075(6)(a)1.c.
Marital Funds Spent on Nonmarital Property
Spending marital money on a nonmarital asset does not necessarily turn an asset into marital property. The marital estate also does not automatically receive a dollar-for-dollar credit for every amount spent.
Rather, the marital funds must have enhanced the value of the nonmarital asset. Fla. Stat. § 61.075(6)(a)1.b.
In Wilson v. Hurter, the trial court treated $72,000 in marital expenditures on the wife’s premarital home as the marital interest in the property. 421 So. 3d 795, 797 (Fla. 2d DCA 2025). The Second District reversed because the court had “considered marital expenditures without evidence or findings that those expenditures enhanced the value of the premarital asset.” Id. at 797-98. The husband conceded that $57,000 in property taxes and insurance should not have been included, and the remaining expenditures could be considered only if they truly increased the home’s value. Id. at 798. The wife owned only a fifty-percent interest in the home with her father, so any distributable enhancement also had to be limited to her share. Id.
Put simply, routine expenses that just maintain or preserve an asset may be treated differently from improvements that increase its market value. The party that claims marital enhancement must present evidence connecting the marital expenditure to an actual increase in value.
Mortgage principal paid with marital funds is treated separately. Florida’s statute includes the marital principal reduction and, in some circumstances, a portion of the property’s passive appreciation in the marital estate. Fla. Stat. § 61.075(6)(a)1.c.
Appreciation of a House Owned Before Marriage In A Florida Divorce
A house acquired before the marriage usually remains the owner spouse’s nonmarital property. Fla. Stat. § 61.075(6)(b)1. Yet, marital funds used during the marriage can create a marital interest in the property’s equity and appreciation without converting the whole house into marital property. Fla. Stat. § 61.075(6)(a)1.b.-c.
In Kaaa v. Kaaa, the husband purchased the parties’ home around six months before getting married, and marital funds were subsequently used to reduce the mortgage and renovate the property. 58 So. 3d 867, 869 (Fla. 2010). The Florida Supreme Court stated, “it is the passive appreciation in the value of the home that is the marital asset, not the home itself.” Id. at 871. It held that, under the law at the time, when marital funds serviced a mortgage on nonmarital real property, the property’s passive, market-driven appreciation may be subject to equitable distribution. Id. at 872-73.
The formula in Kaaa for calculating the marital share of that passive appreciation was later superseded by statute. Matyjaszek v. Matyjaszek, 255 So. 3d 372, 374 n.3 (Fla. 4th DCA 2018). Currently, there is a specific formula for finding the marital portion of passive appreciation when marital funds pay down the principal of a mortgage secured by nonmarital real property. Fla. Stat. § 61.075(6)(a)1.c.
Florida’s Formula for Passive Appreciation of Nonmarital Real Estate
When marital funds pay down a mortgage secured by nonmarital real property, Florida views “the paydown of principal” and “a portion of any passive appreciation” as marital assets. Fla. Stat. § 61.075(6)(a)1.c.
The statute first states that “passive appreciation is determined by subtracting the value of the property on the date of the marriage or the date of acquisition of the property,” whichever is later, from its value on the valuation date, less any active appreciation and qualifying additional encumbrances. Fla. Stat. § 61.075(6)(a)1.c.(I).
Additionally, the calculation subtracts any active appreciation during the marriage and “any additional encumbrances secured by the property during the marriage in excess of the first note and mortgage on which principal is paid from marital funds.” Fla. Stat. § 61.075(6)(a)1.c.
Second, the coverture fraction “must consist of a numerator” equal to the total mortgage principal paid with marital funds during the marriage. Fla. Stat. § 61.075(6)(a)1.c.(II). The denominator is the property’s value on the latest of the marriage date, acquisition date, or the date the property was encumbered by the first mortgage on which principal was paid with marital funds. Id.
The court multiplies the passive appreciation by the coverture fraction to find the marital portion of the passive appreciation. Fla. Stat. § 61.075(6)(a)1.c.(III). The total marital portion is that amount, the mortgage principal paid with marital funds, and any active appreciation attributable to marital funds or efforts, “not to exceed the total net equity” on the valuation date. Fla. Stat. § 61.075(6)(a)1.c.(IV).
The court is required to apply the statutory formula, unless a party demonstrates that its application “would be inequitable” under the facts presented. Fla. Stat. § 61.075(6)(a)1.c.(V).
Appreciation of a Nonmarital Business In A Florida Divorce
A business interest acquired before the marriage or inherited by one spouse may stay nonmarital, even if that spouse works for the business during marriage. Fla. Stat. § 61.075(6)(b)1.-2. However, the increase in the business’s value attributable to either spouse’s marital labor may be divided as a marital asset. Fla. Stat. § 61.075(6)(a)1.b.
In Bair v. Bair, “there was no dispute” that the husband’s ownership interest in Quality Boats was nonmarital or that his marital labor contributed to an increase in the business’s value. 214 So. 3d 750, 753-54 (Fla. 2d DCA 2017). Accordingly, the trial court had to find the amount of the increase attributable to the husband’s marital labor and equitably distribute that increase as a marital asset. Id. at 754.
For a closely held business, Florida law states that the applicable standard of value is fair market value. Fla. Stat. § 61.075(6)(a)1.f.(I). Goodwill separate from the continued presence and reputation of the owner spouse is enterprise goodwill, “which is a marital asset that must be valued by the court.” Fla. Stat. § 61.075(6)(a)1.f.(II).
Quality Boats had to be valued as a whole since “the sum of all parts, not a select few,” encompasses a business’s value. Id. at 754-55. Thus, the trial court erred when it excluded company-owned real estate simply because its change in value came from passive market forces. Id. at 754-55. The relevant inquiry was “how much the marital labor actually contributed to the enhanced value of the business,” instead of just what percentage of the company the spouse owned. Id. at 757. The court still approved the use of the husband’s 47.5% ownership share, as the evidence showed that he and his brother contributed to the business in approximately equal measure. Id. at 757-58.
Retirement Accounts With Marital and Nonmarital Portions In A Florida Divorce
Florida law states that “[a]ll vested and nonvested benefits, rights, and funds accrued during the marriage” in pension, retirement, annuity, profit-sharing, deferred-compensation, and insurance plans are marital assets. Fla. Stat. §§ 61.075(6)(a)1.e., 61.076(1).
Accordingly, a retirement account opened before marriage may contain both marital and nonmarital portions. In Kincaid v. Kincaid, the husband rolled two premarital IRAs, marital retirement accounts, and additional marital funds into a new Roth IRA and a new traditional IRA. 397 So. 3d 1169, 1173-74, 1176 (Fla. 5th DCA 2024). The court explained, “[a] precise valuation of the marital portion of the two new IRAs requires that the appreciation of the premarital portion be calculated separately from that of the marital portion.” Id. at 1176. Further, “[t]he burden of proof on the accumulated value of the two IRAs” rested with the husband as the spouse asserting the nonmarital claim. Id. Since he relied on a performance summary without supporting expert or other explanatory testimony, the trial court was entitled to determine that he failed to present competent, substantial evidence of the nonmarital passive appreciation. Id. at 1176-77.
If contributions are made after the dissolution petition, they are generally viewed as nonmarital. As Duhamel v. Duhamel states, “when a spouse continues to contribute to a retirement fund after the petition for dissolution is filed, the postfiling contributions are nonmarital.” 385 So. 3d 209, 214 (Fla. 2d DCA 2024). However, when no additional contributions are made, an increase in the account’s value is considered passive accumulation. Id. Each spouse retains “an interest in the marital part of the assets, and any passive accumulations thereon, through” the date of the final hearing. Id. (quoting Jahnke v. Jahnke, 804 So. 2d 513, 516 (Fla. 3d DCA 2001)).
Commingling and Tracing Appreciated Assets In A Florida Divorce
When nonmarital assets are mixed with marital assets, they may lose their separate character. This is especially true of money, as “[m]oney loses its nonmarital character when it is commingled with marital money and becomes untraceable.” Belmont v. Belmont, 761 So. 2d 406, 408 (Fla. 2d DCA 2000).
Yet, “[u]sing some portion of non-marital funds to pay marital expenses does not convert the remaining non-marital funds into a marital asset.” Grieco v. Grieco, 917 So. 2d 1052, 1055 (Fla. 2d DCA 2006). At most, just the portion withdrawn and used for marital purposes loses its nonmarital character. Id.
The way an account is reported does not control when the funds stay traceable. As Grieco states, “[c]onsolidated bank statements reflecting a total account balance for the Husband and Wife do not change the character of the Husband’s inherited funds where those funds remain separate and identifiable.” Id. Thus, a spouse claiming a nonmarital portion should preserve records that show the source and movement of the funds.
Proving and Valuing Marital Appreciation
As Higgins v. Higgins explains, “[t]he party asserting entitlement to an increase in the value of nonmarital property has the burden of proving the enhancement.” 226 So. 3d 901, 906 (Fla. 4th DCA 2017). After that party establishes that marital labor or funds were used to enhance the nonmarital property’s value, “the burden shifts to the other party to show that some, if any, portion of the enhanced value is exempt from equitable distribution.” Id.
The court must further determine the amount of the enhancement attributable to marital contributions. The court in Higgins states that, “to make an award for the enhancement in value and appreciation of a nonmarital asset, the court must make specific findings as to the value of such enhancement and appreciation during the marriage, as well as which portion of that enhanced value is attributable to marital funds and labor.” Id. at 906-07 (quoting Martin v. Martin, 923 So. 2d 1236, 1239 (Fla. 1st DCA 2006)).
In Higgins, the evidence did not establish the amount by which the property’s value or equity had increased during marriage. Id. at 907. So, the appellate court reversed the classification of all sale proceeds as marital and made the trial court evaluate additional evidence and make findings regarding the enhanced value and increased equity attributable to marital contributions. Id.
When it is a contested divorce, the court cannot divide an alleged marital enhancement without explaining how it reached the result. Section 61.075 requires the distribution to be supported by factual findings based on competent, substantial evidence; the final judgment needs to include “specific written findings of fact,” clearly identify the nonmarital ownership interests, provide the “individual valuation of significant assets,” and explain the court’s rationale for its distribution. Fla. Stat. § 61.075(3)(a)-(d).
This generally means evidence of the asset’s value at the beginning and end of the relevant period is necessary. The evidence must further allow the court to separate appreciation attributable to marital funds or labor from appreciation attributable to market forces or other nonmarital causes. Depending on the type of asset, evidence of improvements, appraisals, business records, mortgage histories, and expert valuation testimony may all be relevant.
Suppose Spouse A entered the marriage owning a business worth $600,000, and the business was worth $900,000 when the divorce petition was filed. The court is unable to automatically classify the entire $300,000 increase as marital.
The spouse who wants a share must connect the increase to marital labor or funds. Then, the owner spouse may attempt to prove that some portion resulted from inflation, industry growth, employees’ efforts, or other passive causes. Ultimately, the court must identify the amount attributable to marital contributions instead of simply dividing the total increase.
The date used to classify an asset is not necessarily the date used to value it. The statutory classification cut-off is typically the earliest of a valid separation agreement, another date explicitly agreed to by agreement, or the filing of the dissolution petition. Fla. Stat. § 61.075(7). The court can choose a valuation date that is “just and equitable under the circumstances,” and “[d]ifferent assets may be valued as of different dates.” Id.
This distinction is important in cases where an asset changes substantially after the petition is filed. A business may keep increasing due to the owner spouse’s post-filing labor, while an existing investment or retirement-account balance may keep passively growing. The court must choose a valuation date and method that identifies the marital portion without improperly including value due to post-filing efforts or excluding passive growth that belongs to the marital estate.
Prenuptial and Postnuptial Agreements In Florida
Spouses can alter Florida’s ordinary equitable-distribution rules through a valid written agreement. Section 61.075 classifies assets and liabilities “excluded from marital assets and liabilities by valid written agreement of the parties,” along with assets and liabilities acquired in exchange for them, as nonmarital property. Fla. Stat. § 61.075(6)(b)4.
A premarital agreement “must be in writing and signed by both parties.” Fla. Stat. § 61.079(3). The couple may establish their respective rights in property and determine “[t]he disposition of property upon separation, marital dissolution, death, or the occurrence or nonoccurrence of any other event.” Fla. Stat. § 61.079(4)(a)1.-3. According to the statute, property includes present and future interests, income and earnings, and “both active and passive” property. Fla. Stat. § 61.079(2)(b).
The agreement determines whether a spouse has waived a claim to the appreciation of the other spouse’s property. When an agreement is clear, “the language itself is the best evidence of the parties’ intent, and its plain meaning controls.” Hahamovitch v. Hahamovitch, 174 So. 3d 983, 987 (Fla. 2015).
In Hahamovitch, the spouses agreed that each would keep “sole ownership, control, enjoyment and power of disposition” over property then owned or later acquired and that “neither will ever claim any interest in the other’s property.” Id. at 985-87. The agreement further stated that property acquired in one spouse’s name would be owned only by that spouse. Id. at 985-86.
The Florida Supreme Court held that, based on the plain meaning of the provisions, property owned or later acquired by the husband in his name, “including any enhancement in value or appreciation of such properties,” stayed as his nonmarital property. Id. at 987. Accordingly, sufficiently broad language may cover appreciation caused by marital income, funds, or efforts even when the agreement does not separately use the words “appreciation” or “enhancement.”
A more limited agreement might produce a different result. In Weymouth v. Weymouth, the wife waived claims to property the husband owned before marriage. 87 So. 3d 30, 32 (Fla. 4th DCA 2012). Yet, the agreement also stated that property acquired during the marriage, other than property received by gift or inheritance, would be marital property, and it had no express waiver of the growth or appreciation of premarital assets. Id.
Thus, the court held that the agreement did not waive the wife’s claim to the enhanced value of the husband’s premarital house. Id. at 34-35. The wife had released her interest in the property the husband owned when the agreement was executed, but the agreement did “not specifically address enhancement value.” Id. at 35. Although the underlying home remained the husband’s nonmarital property, the court held that the home’s passive appreciation was subject to equitable distribution. Id. at 35-36.
The difference between Hahamovitch and Weymouth does not turn on the use of a single phrase. The agreement instead must be read as a whole. Language that addresses just ownership of property existing before marriage may not waive a claim to its appreciation. Broader provisions that cover sole title, present and future property, and claims arising from the marriage may encompass both the underlying asset and its appreciation.
Additionally, a postnuptial agreement may determine whether an asset and its appreciation remain separate. Florida law classifies assets and liabilities excluded from the marital estate by a valid written agreement, and assets acquired in exchange for them, as nonmarital property. Fla. Stat. § 61.075(6)(b)4.
Even carefully drafted language must be included in an enforceable agreement. A premarital agreement is not enforceable if the party against whom enforcement is sought proves that “[t]he party did not execute the agreement voluntarily”; “[t]he agreement was the product of fraud, duress, coercion, or overreaching”; or the agreement was unconscionable when executed and, before execution, that party was not given fair and reasonable financial disclosure, did not voluntarily and expressly waive in writing any right to disclosure beyond the disclosure provided, and “did not have, or reasonably could not have had,” adequate knowledge of the other party’s property or financial obligations. Fla. Stat. § 61.079(7)(a).
Conclusions About Appreciation of Assets In A Florida Divorce
The fact that an asset is nonmarital does not automatically mean that each and every dollar of its increased value belongs to the owner spouse. Florida law separately evaluates whether marital funds, marital labor, or other marital assets caused the asset to appreciate. The house, business, investment, or retirement account may remain nonmarital while a part of its growth is classified as marital property. Fla. Stat. § 61.075(6)(a)1.b.
Nonmarital real estate is given additional treatment when marital funds reduce mortgage principal. When marital funds reduce the mortgage principal on nonmarital real property, “[t]he total marital portion of the property consists of the marital portion of the passive appreciation [and] the mortgage principal paid during the marriage from marital funds,” together with any active appreciation attributable to marital contributions, yet the total cannot exceed the property’s net equity on the valuation date. Fla. Stat. § 61.075(6)(a)1.c.(IV). The court “shall apply the formula” unless a party shows that doing so “would be inequitable under the facts presented.” Fla. Stat. § 61.075(6)(a)1.c.(V).
In all, the result is dependent on the cause of the appreciation and the available proof. Account and mortgage records, documentation of marital expenditures, beginning and ending valuations, evidence of either spouse’s labor, and expert testimony might be required to separate the marital enhancement from the nonmarital asset. A valid prenuptial or postnuptial agreement may fix the issue in advance, but its language must be broad and precise enough to address appreciation instead of simply ownership of the original asset.
Russell D. Knight is a divorce and family law attorney licensed in Florida and Illinois. He has practiced family law since 2006 and has been licensed to practice law in Florida since 2018. His work includes property division, prenuptial and postnuptial agreements, and other financial issues arising in divorce.
CASES AND STATUTES REFERENCED IN THE APPRECIATION OF NONMARITAL ASSETS IN A FLORIDA DIVORCE ARTICLE
Fla. Stat. § 61.075(1) — Equitable Distribution And The Initial Presumption Of Equal Division
Fla. Stat. § 61.075(3)(a)–(d) — Required Written Findings And Valuation Of Significant Assets
Fla. Stat. § 61.075(6)(a)1.e. — Retirement Benefits, Rights, And Funds Accrued During Marriage
Fla. Stat. § 61.075(6)(b)1.–4. — Classification Of Nonmarital Assets And Liabilities
Fla. Stat. § 61.075(7) — Classification And Valuation Dates
Fla. Stat. § 61.075(8) — Presumption That Property Acquired During Marriage Is Marital
Fla. Stat. § 61.076(1) — Distribution Of Retirement Plans Upon Dissolution Of Marriage
Fla. Stat. § 61.079(2)(b) — Definition Of Property Under The Uniform Premarital Agreement Act
Fla. Stat. § 61.079(3) — Formal Requirements For A Premarital Agreement
Fla. Stat. § 61.079(4)(a)1.–3. — Property Rights And Disposition Under A Premarital Agreement
Fla. Stat. § 61.079(7)(a) — Grounds For Challenging The Enforceability Of A Premarital Agreement
Martin v. Martin, 923 So. 2d 1236 (Fla. 1st DCA 2006)
Naranjo v. Ochoa, 366 So. 3d 11 (Fla. 4th DCA 2023)
Wilson v. Hurter, 421 So. 3d 795 (Fla. 2d DCA 2025)
Kaaa v. Kaaa, 58 So. 3d 867 (Fla. 2010)
Matyjaszek v. Matyjaszek, 255 So. 3d 372 (Fla. 4th DCA 2018)
Bair v. Bair, 214 So. 3d 750 (Fla. 2d DCA 2017)
Kincaid v. Kincaid, 397 So. 3d 1169 (Fla. 5th DCA 2024)
Duhamel v. Duhamel, 385 So. 3d 209 (Fla. 2d DCA 2024)
Jahnke v. Jahnke, 804 So. 2d 513 (Fla. 3d DCA 2001)
Belmont v. Belmont, 761 So. 2d 406 (Fla. 2d DCA 2000)
Grieco v. Grieco, 917 So. 2d 1052 (Fla. 2d DCA 2006)
Higgins v. Higgins, 226 So. 3d 901 (Fla. 4th DCA 2017)
Hahamovitch v. Hahamovitch, 174 So. 3d 983 (Fla. 2015)
Weymouth v. Weymouth, 87 So. 3d 30 (Fla. 4th DCA 2012)
FREQUENTLY ASKED QUESTIONS ABOUT APPRECIATION OF NONMARITAL ASSETS IN A FLORIDA DIVORCE
Is the appreciation of a nonmarital asset marital property in Florida? It potentially is; the underlying property can remain nonmarital, but the increase in its value may be marital when the appreciation results from marital funds, either spouse’s efforts, or other marital assets. Appreciation caused only by passive market forces usually stays nonmarital, subject to Florida’s separate rule for mortgaged nonmarital real property.
Does spending marital money on a nonmarital asset make the entire asset marital? Not automatically. The marital expenditure usually must produce a real enhancement in the asset’s value.
How is the appreciation of a house owned before marriage divided in Florida? Usually, the house remains the owner spouse’s nonmarital property. However, when marital funds reduce mortgage principal, the marital estate may include the principal reduction, active appreciation attributable to marital contributions, and a statutory share of passive appreciation. Florida law uses a coverture fraction to calculate the marital share of passive appreciation.
Is passive appreciation of an investment account marital property? Purely passive growth typically stays nonmarital when it comes from market conditions or the work of independent investment managers rather than one of the spouse’s efforts. The spouse arguing for a nonmarital portion must still be able to trace and prove that portion. Mixing the funds with marital money can complicate or defeat the nonmarital claim if the funds become untraceable.
Can a retirement account contain both marital and nonmarital portions? Yes, contributions and benefits accumulated during marriage are often marital, while a proven premarital balance may stay nonmarital. The appreciation attributable to the premarital portion must be calculated separately from the appreciation attributable to the marital portion. Postfiling contributions are typically nonmarital, while passive growth on the existing marital portion may continue to belong to the marital estate through the final hearing.
