When you file for divorce in New York, all property acquired during the marriage is subject to equitable distribution, meaning that you divide it in a way that’s equitable, or fair. Until relatively recently, this property was mostly money, real estate, assets like cars, furniture, and jewelry, and even businesses.
These days, it’s different. Thanks to a variety of available reward programs, a marital estate could include digital property such as air miles, although it can be tricky to place a value on them so that they can be divided.
Are air miles worth dividing?
When the number of available miles is low, it may not be worth the time and expense involved to divide and distribute them in divorce. However, if there are hundreds of thousands or even a million miles, then it can be a different story, as these miles can be redeemed for expensive perks.
If you or your spouse had a credit card that allowed you to earn air miles with each purchase and used it during the marriage, then those miles are treated as a marital asset during divorce. The question is, what are they worth?
Not all reward programs assign a dollar value to their miles. When this happens, the court can make a rough estimate based on the number of miles needed to earn a certain reward, such as economy fare to Paris, France or a business class ticket to Los Angeles.
For example, if the program requires you to earn 50,000 points to earn that ticket to Los Angeles (which would typically cost $1500), then the court may attribute a value of $1500 to each 50,000-mile segment in the account. Once a value has been assigned, one of two things can happen:
- If the miles are transferable, then the court may divide them into two separate reward accounts.
- If they aren’t, then the spouse with the rewards credit card may be allowed to keep the miles while the other spouse receives marital property of comparable value.
On the surface, including an air miles balance in a New York divorce may seem like a waste of time given the other items that need to be divided, such as bank accounts, real estate holdings, and other expensive items. However, a significant accumulation can translate into a high-value item, like a first-class ticket to London, and you may wish to include the miles in a divorce action.
Anyone preparing to divorce in New York state should contact an experienced divorce attorney who can help itemize both tangible and digital marital assets, propose an equitable split, and help ensure that you leave the marriage with assets that fairly reflect your contribution to the marital estate. Jayson Lutzky is a Bronx divorce and family court lawyer with over 35 years of experience. He offers free in-office consultations and can be reached at 718-514-6619. Learn more at www.MyNewYorkCityLawyer.com/Divorce.