The distinction between community and separate property can be complex to understand. Community property refers to assets and liabilities that spouses acquire during a marriage, while separate property refers to assets and liabilities acquired before the marriage, or by gift or inheritance or after the date of separation. However, there may be some cases where property can be both community and separate. This blog post will explore this concept further and discuss how you can protect your assets.
What are Community Property and Separate Property in a Divorce?
In California, community property presumptively refers to assets and liabilities that a couple acquires during a marriage. This includes income earned by either spouse and any assets purchased or debts accrued during the marriage. Separate property, on the other hand, presumptively refers to assets and liabilities acquired before the marriage or by gift or inheritance or after the date of separation. This can include items like property owned before the marriage, inheritances or gifts received by one spouse, or personal injury settlements. It is important to understand the distinction between community and separate property, as it can affect the distribution of assets in the event of a divorce.
Examples of Community Property
Examples of community property can include shared bank accounts, shared investment accounts, retirement accounts, real estate purchased during the marriage, and other significant assets. Community property can also include income earned during the marriage, such as salaries, wages, and earnings from a business.
Examples of Separate Property
Examples of separate property can include one spouse’s assets and liabilities before the marriage, inheritances or gifts received by one spouse, and personal injury settlements. Separate property can also include items like furnishings or vehicles that one spouse solely owned before the marriage or after the date of separation.
How Can Property Be Both Community and Separate Property?
In some cases, property may be both community and separate. For example, a home that one spouse owned before the marriage may have been considered separate property. However, if the couple made mortgage payments together or renovated the property during the marriage, the property may now be considered both community and separate. This can make it complicated to determine how the property should be divided in the event of a divorce or death.
A Common Issue: What Happens if One Spouse Wishes to Keep the Home Following a Divorce?
A common issue in a divorce is how to divide the interest in the family residence if one party purchased the home prior to marriage. That party may claim that 100% of the equity in the home belongs to them which may or may not be correct. The Court will consider some of the facts surrounding the purchase of the property, the source of the mortgage payments, the source of the funds for improvements and if and when the other party went onto title of the property.
Navigating complex divorce situations can be challenging, but it doesn’t have to be overwhelming. At the Law Offices of Judy L. Burger, we understand the specifics of California family law and the importance of protecting your assets. Our skilled attorneys can help you navigate the complexities of community and separate property. Contact us to schedule an appointment.