California Community Property Laws
Regardless of where the marriage took place, divorces that are filed in the state of California are governed by the concept known as “community property division.” (Unless a valid prenuptial agreement provides otherwise.) According to California community property law, with only minor exceptions, all assets and debt acquired from the date of marriage until the date of separation are characterized as community property and subject to equal division between both parties of the divorce.
To ensure your personal belongings are protected in the division of your property, contact our Carlsbad property division lawyers at Griffith, Young & Lass. Call 858-951-1526 or submit an online contact form here.
Methods Of Division Of Community Property
Community property and community debt can be divided “in-kind” or not “in kind.” “In-kind” division essentially means that a particular asset and/or debt will be divided down the middle. Obviously, it is not always possible to divide every asset down the middle unless the asset is sold.
It is quite common in divorce cases for the parties to distribute assets according to the interests of the parties and to equalize unequal division with an “equalization payment.” A good example of this would be if one spouse wanted to keep the community residence. Assuming that the residence had equity, the spouse retaining the residence would owe to the “out spouse” an equalization equal to one half the total community interest in the property. This equalization could be traded off against other assets like retirement accounts, investment accounts, or cash on hand.
Broadly speaking, assets and debt acquired after marriage are considered community property. However, individuals can retain separate property in a divorce proceeding. The most common example of separate property is assets that an individual owned prior to entering the marriage. Those assets can include objects, real estate, investments, cash, and retirement savings.
Often, assets that were initially separate are comingled during a marriage. For example, a house owned prior to the marriage may be sold and the money used to purchase another house. If there is a clear paper trail, the established value of the initial home can typically be removed from community property.
Two specific types of assets gained during marriage also qualify as separate property in divorce proceedings: gifts and inheritances. For example, if one spouse is given a rare painting or inherits a lump sum of cash, that asset is an individual asset and is retained by the person following a divorce proceeding.