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Credit card reward points in a divorce

On Behalf of | Mar 15, 2022 | High Asset Divorce

With a digital economy that’s continuously on the rise, it has led to entirely new forms of assets – and new types of problems with dividing them when it comes to splitting up a New Jersey marriage. Credit card reward points are a prime example of the way this digital realm has altered the landscape of divorce, and these rewards play into the division of marital assets more commonly every day.

Credit card points: Who owns them?

The complication with credit card reward points comes with the lack of ownership: It’s not possible for either party to be the legal owner of these points. Usually, in any agreement signed by the cardholder in a rewards program, a number of stipulations are commonly made. This generally includes the disclaimers that the points don’t have actual cash value, they aren’t the legal property of the cardholder, and legal actions such as a divorce don’t work for transferring these types of points.

Since it is, however, possible to cash in on these points for traveling expenses, special merchandise, or even actual money, the argument may be made that these points still have a value to them. This would make them part of the marital property being divided in the high asset divorce.

Things only become more complex once the classification of marital property has been established for these business credit card rewards. For one thing, a specific dollar value has to be given to the points. The only exception to this rule is if the reward points are divvied up equally between the two parties.

Assets come in many forms, and the digital shift has changed the way they are broken up in divorce dramatically. The most important factor that comes into play when determining who gets the credit card reward points after the divorce is the timeline of events. Everything depends on when these reward points were earned. Much less important is the actual person’s name on the account that the points are in.