Understanding California Community Property Law
The courts look at marriages like partnerships in the State of California, so when it comes to divorce, spouses are co-owners.
If you live in California and are contemplating or about to actually file for a divorce, you need to be aware that California is a community property state, one of only nine like it in the United States. Community property means that spouses are regarded as co-owners of property, like being in a partnership.
There are three categories that married spouses may fit into when facing a divorce in California, the first being community property; the second being separate property; and the third being quasi-community property. Why the different categories when a couple is getting divorced?
The category the property happens to fall into controls how it is divided when the divorce is final. For instance, California’s community property law says community property is considered to be “all” property, no matter where it is located, that was acquired by the married couple while they lived in California. If the property is located within California, the California law classifies such property as community property. If the property is located outside the State of California, it is called quasi-community property.
Generally speaking, the couple both own property that they bought between the time they were married and the day they separated. Each of them owns a one-half interest in that property. This is what is referred to as community property, with both people owning it at the same time.
On the other hand, separate property is property that either spouse owned “before” the marriage or after separation. Or, it might also be assets that were received during the marriage as a gift or an inheritance. An example of this might be if a relative gifted an ancestral home to the wife. That home is then hers and is considered to be separate property at divorce time.
On another note relating to separate property: if any money is earned from that property, it is considered separate. However, if income is generated by both spouses and it is not related to the separate property, it is community property and it doesn’t matter if the money is in separate bank accounts.
Things tend to get a bit complicated when it comes to the quasi-community property category. The law looks at that as all property, no matter where it is located, or if it was bought before or after the operative date of the community property code. Wait, it gets worse, as here are the various ways property may be acquired: by either partner while living someplace else, which would have been community property if the person who bought it had been living in California when it was purchased; or if the property was acquired by exchange, then it would have been community property if the person who exchanged it had been living in California when the property was exchanged.
Talk about confusing to say the least. So to simplify things a bit, typically quasi-community property means a property acquired by a couple when they lived in an equitable distribution state prior to living in California. Once they move to California, their quasi-community property is treated like community property.
There’s one other thing that divorcing California couples need to know and that is that there are instances where separate property may become community property during the course of the marriage. To say this would come as a really unpleasant surprise is an understatement.
If you are contemplating filing for a divorce in California, make sure you hire an expert divorce lawyer who will outline the details about community property and guide you through the tangled divorce process.
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