Divorce judge made a ruling regarding the real estate on which Husband’s nonmarital business was located. The Court said that it was marital property. It said that Husband had not proven that he acquired the property in a way listed in the divorce statute. Husband did not prove it was his nonmarital property. Husband appealed.

The Appellate Court stated that all property owned by the parties in a dissolution proceeding belongs to one of three estates. Either the husband’s estate, the wife’s estate, or the marital estate. After the trial court classifies the property, it awards each spouse his or her nonmarital property. It then divides the marital property into just proportions.

Section 503 had been revised. It added language regarding tax planning purposes. “The presumption of marital property is overcome by showing through clear and convincing evidence that the property was acquired by a method listed in subsection (a) of this Section or was done for estate or tax planning purposes or for other reasons that establish that a transfer between spouses was not intended to be a gift.”

In order to trigger the “estate or tax planning” language under section 503(b)(1), one must first show through clear and convincing evidence that the property at issue was originally nonmarital under section 503(a).

Husband’s argues that the real estate under his business is his nonmarital property under section 503(b)(1). Husband says he titled it in his individual name “for tax purposes.” This relies on a flawed reading of an isolated portion of the statute and puts the proverbial cart before the horse.

In re Marriage of James, 2018 IL App (2d) 170627.

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