Since California is a community property state, many people assume they know how property will be divided in divorce. However, there are many more factors that play into the process than most people realize.
To protect your interests, it is important to understand your rights when it comes to separate and community property. While you and your spouse are free to develop your own plans for dividing assets and debts, it is helpful to know what the court would do and use that as a starting point for negotiations.
First Things First: Addressing Property Classification
Before considering how property will be divided in a California divorce, it is essential to understand how property will be classified. Property treated as separate property will not be subject to division at all. The spouse who owns assets as their separate property gets to walk away with those assets free and clear. Property classified as marital or community property, on the other hand, will be divided during the divorce process.
It is in your best interests to locate evidence demonstrating why certain property should be considered solely yours as separate property. Your attorney can help you gather evidence, which may require the assistance of a forensic accountant or other professionals.
What is Separate Property in California?
In general, property that individuals own before they get married is their separate property. Additionally, property that a spouse acquires as a gift (from someone other than their spouse) or through an inheritance or bequest is also considered separate property. So if you want to prove that certain property should not be divided in divorce, it is helpful to look for records proving you owned it before the wedding or that it was given to you individually as a gift or inheritance.
Unfortunately, even that evidence may not be enough to allow you to keep that property without dividing it. That’s because separate property can transform into marital community property during the marriage. If you don’t take specific steps to keep your property separate, then at least some of the value of that property could belong to your spouse.
You can keep property separate by various means such as:
- Executing a pre- or postnuptial agreement specifying that the property will be kept as your separate property
- Keeping separate funds in an individual bank account and not using funds for any marital purposes
- If the property requires upkeep, such as a vehicle or home, avoid using marital funds to pay for maintenance, taxes, insurance, or other expenses
Your attorney can help you develop a plan to maintain the separate nature of your individual property during the marriage. If you don’t take steps to keep the property separate, then a court could determine that any increase in value, at least, is marital community property. If your spouse contributed to the property in some way or if marital funds were mingled with separate funds, you may have to work very hard to separate your share. Without the right arguments and evidence, a court might simply conclude that all of an account or item of property should be treated as marital property.
Marital Property is Divided Evenly in Divorce in California
Anything acquired during the marriage—and any separate property that has transformed into marital property—is considered community property that must be divided between spouses in divorce. In California, marital property is divided equally in a 50/50 split. This includes property such as retirement benefits earned by one spouse.
Marital debts are also divided equally unless you have a written agreement specifying otherwise.
In many cases, you do not actually divide every single asset in half. You can assess the value of all assets and develop a plan to ensure that each spouse receives assets worth an equal value.
All asset division plans can become complicated, particularly when there are assets that may be difficult to value objectively. It is important to work with an attorney who understands the complexities of asset division. If assets include a business, unique real estate, executive compensation, or other intricate property interests, you may want to bring in valuation experts or other specialists to ensure that your interests are fully protected.
Holstrom, Block & Parke, APLC Helps You Obtain Advantageous Results in Property Division
As a team of Certified Family Law Specialists and associates, the attorneys at Holstrom, Block & Parke, APLC have years of experience working to ensure that clients receive the right allocation of property and debts in their divorce. In fact, we have over 300 years of collective experience to put to work on your behalf. We invite you to schedule a confidential consultation to learn more about the ways we can help you achieve your goals in divorce.