When people think about dividing assets in a divorce, they usually focus on homes, retirement accounts, and bank balances. But many couples also accumulate less obvious assets over time, including frequent flyer miles, hotel points, and other travel rewards. These benefits can carry real value, and in Washington divorces, they are often considered part of the overall property division.
Are Frequent Flyer Miles Considered Marital Property?
In Washington, assets acquired during marriage are generally presumed to be community property, regardless of whose name is on the account. This can include airline miles and travel rewards earned during the marriage, even if they are tied to one spouse’s personal travel account.
That said, just because miles are technically divisible does not mean they are always divided in a literal or equal way.
The Practical Challenge of Dividing Miles
Frequent flyer miles can be difficult to divide for several reasons. Some airline programs restrict or charge fees for transferring points between accounts. Others prohibit transfers entirely. In addition, the value of miles is not fixed, it can vary depending on how and when they are redeemed.
Because of these complications, dividing miles directly between spouses is often impractical.
The “Buyout” Approach
In many cases, the most efficient solution is to allocate the miles to the spouse who earned or controls the account and provide a corresponding credit to the other spouse as part of the overall property division.
This is sometimes referred to as a “buyout” approach. Instead of splitting the miles themselves, the court or the parties assign a reasonable value to the points and offset that value with other assets. For example, one spouse might keep the miles while the other receives additional funds from a bank account, equity in a home, or another asset to balance the division.
Valuing Frequent Flyer Miles
Determining the value of miles can be challenging. Some parties use a rough cents-per-mile estimate, while others look at how the miles have historically been used, such as for flights, upgrades, or travel packages. The goal is not to achieve perfect precision, but to arrive at a fair and reasonable approximation for settlement purposes.
When Miles May Be Overlooked
In some divorces, frequent flyer miles are simply not worth the time and expense required to value and divide them. If the total value is relatively small compared to other assets, parties may agree to let each person keep the rewards in their own name without further adjustment.
However, in high-asset cases or situations involving extensive travel rewards, miles and points can represent a meaningful asset that should not be ignored.
Frequent flyer miles can be divided in a Washington divorce, but the most practical approach is often to award the miles to the earning spouse and compensate the other spouse through a buyout or offset. Understanding the value and limitations of these rewards can help parties reach a more efficient and balanced resolution. At Magnuson Lowell, P.S., we help clients identify and divide all types of marital assets, including less obvious ones like travel rewards, in a way that is both practical and equitable. We offer free telephone (425-800-0582) case evaluations to discuss your situation and options.
