You've made the decision to file for either a legal separation or divorce and your assets and debt will need to be divided. If the parties involved cannot reach a mutually beneficial decision on their own, they will need to get the courts involved. Our experienced Orange County divorce attorney dedicated to family law can help you decipher the complex legalities of property division.
Community vs. Separate Property in California
California is one of nine states that has a mandatory community property requirement. Simply put, monies earned by either party during the time of marriage or properties purchased with those funds are considered community property and owned equally by each spouse.
Separate property is any asset owned solely by one spouse. These include assets acquired before the marriage or domestic partnership, any gifts or inheritances received solely for a one spouse's benefit, and assets accrued after an official date of separation.
It may seem straightforward, but determining what is and is not considered community or separate property can get extremely complicated. At W. Douglas McKeague, we can provide you with our lawyer who is ready to facilitate an accurate and fair evaluation of your properties.
What defines property?
You may think the definition of "property" only includes items that can be purchased or sold such as your house, vehicles or artwork. In reality, property includes anything that can be assigned a value.
Examples of what is considered property in California are:
- Stocks and bonds
- Pensions and 401K plans
- Life Insurance policies
- Businesses – both the current and "goodwill" value
- Vacation pay and other employee benefits
More Than One Type of Community Property
Assuming that only assets purchased or operated in California fall under the umbrella of community property can be a costly misconception. In fact, if you were living in another state during your marriage or domestic partnership and acquired property, state law considers those assets to be possible community property. Essentially, if the assets in question would be considered community property if they were attained in California, they are categorized as "quasi-community property" and would be subject to division.
Comingled Assets
Sometimes things get mixed up. A spouse's separate asset (such as funds acquired before the marriage) maybe used to obtain a community asset (the family home.) Both spouses income may be used to pay the mortgage, property taxes and insurance. The house is now considered a "comingled asset." Distinguishing just how much of the home's value is a separate asset and how much is community property is often a confusing and muddled procedure.
Couples facing a divorce or legal separation should contact our knowledgeable Orange County divorce lawyer who can aid them in untangling their comingled properties.
Who owes what?
California law requires that parties seeking a legal separation or divorce not only share the wealth, but share the debt, as well. Debts are considered similarly to property and fall into either separate or community categories.
As with property, the date of separation is extremely important when assigning debt responsibilities. Parties are liable for any debt incurred by either spouse during the time of marriage, but not after the separation date.
Clearing the Confusion - Contact A OC Divorce Attorney
You've undoubtedly realized by now that splitting your assets and debts is not always clear-cut. Determining the differences between separate and community property and debt is a difficulty that can seem insurmountable.
At W. Douglas McKeague, you will find our attorney is devoted exclusively to family law, and is familiar with the intricacies of a divorce. Let our Orange County divorce lawyer help you negotiate a reasonable and equitable settlement.
Contact us today for your freecase evaluation!