Separate and Community Property for Divorce | Buncher Family Law

Understanding Separate and Community Property in California

When married couples decide to file for divorce there are numerous issues to be dealt with such as division of property and liabilities, child support, child custody, and spousal support. One of the most important matters to be dealt with in a timely manner, which can be hotly contested during divorce, involves property division. The division of property includes both assets and debts the couple acquired during marriage. Oftentimes couples who are not able to reach a resolution on these important issues are forced to litigate them in court.

Because property division can be highly complex many couples are left with questions. California is considered a community property state. Assets that are obtained during a marriage, or any income that is earned by either spouse, is considered community property. Similarly, any debt that is accumulated, by either spouse, is also shared by the community. Separate property assets would be those obtained by a spouse before marriage, inheritance, or those acquired post-separation. According to California law, the community estate is to be divided equally if no specific, written agreement exists. Of course there are caveats, which is why you would want to speak with an attorney about how the law applies to your specific situation.

Understanding How Community Property is Divided

In California, there is no requirement for an “in kind” division of community property. This means that physical objects do not need to be physically divided. Rather, the law requires that the net value of assets that each spouse receives is equal, unless the parties decide otherwise. Division of property can be handled by assigning certain items to each spouse, by allowing one spouse to buy out the other’s share of an asset or by selling assets and dividing the proceeds. Ultimately, spouses are required to receive assets that are equivalent in value.

Likewise all debts accrued during the marriage, including mortgages, car loans, credit card debt, and the like, must be divided. Couples dividing debt must be aware that both spouses will continue to be responsible to the creditor, despite the divorce. For this reason it is often advised that the couple work to pay off as much debt as possible through the divorce process.

Common Difficulties Divorcing Couples Face

Sometimes, it isn’t difficult to determine whether a specific asset is separate or community property. However, various assets can become highly complex, especially those such as businesses that were owned by one spouse prior to marriage, or property that belonged to one spouse before the marriage but was shared during the marriage.

In addition, complexities can arise when property becomes intermingled. This can happen with matters such as inheritances. In most cases, inheritances are considered separate properties. However, when a person uses an inheritance as a payment for a home which the couple shares, the lines which separate community and separate property can become blurred. In these cases, it is wise for couples to contact experienced legal counsel. A seasoned lawyer can work diligently to ensure each party’s rights and belongings
are protected.

Posted in Divorce, Property Division, Separation.