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  3. What’s the Difference Between Community and Separate Property

When a couple goes through a divorce or legal separation, the court must make decisions about how to divide any property the couple bought during their marriage.

Property bought during a marriage is known as community property because the state of California views a married couple as one legal entity. Property bought before the marriage or after the divorce process began is called separate property. Separate property only belongs to the person who purchased it and cannot be divided.

What Is Considered Property?

When most people hear the word ‘property’ they think of a plot of land owned by another person. In divorce litigation, property can be land, but it is also a broader term used to describe any items bought during the marriage.

Examples of property include:

  • Houses
  • Cars
  • Furniture
  • Bank accounts
  • Security deposits
  • Pension plans
  • Patents
  • Stocks

Even if a couple decides on a property division agreement on their own, a court will still need to make the formal order. This is to ensure the property division is valid in the eyes of the state. For example, if a judge doesn’t sign off on a property division agreement and one spouse has a lot of debt, the debt collector can seek compensation from both parties. A property division agreement guarantees the responsibility of the debt will only fall upon the ex-spouse who originally created the debt.

Separate Property

Anything a person owned before a marriage or during the divorce process is classified as separate property. A former spouse has no claim to it and will be denied should they attempt to use it. Separate property consists of the examples listed above, but it is also comprised of a few other items.

Even if a person acquires the types of property listed below while married, it will still be considered separate property in the event of a divorce or separation:

  • Any type of inheritance
  • Gifts that were given to one spouse and not the other
  • Rent, profit, or other money earned from separate property
  • Property bought with separate property earnings

For example, if a spouse bought a car with money inherited from a relative, it exclusively belongs to them because it was bought with separate property.

It’s important to keep track of separate property throughout the entire marriage. It is also important to keep a record of everything purchased or gifted after the official date of separation so none of your separate property accidentally gets lumped in with community property.

Community Property

Everything spouses own together is considered community property. This covers everything purchased or received together during a partnership (including debt and joint gifts). Community property can also be any earnings gained by either spouse while actively involved in the marriage.

For example, one spouse bought a car with money they had been saving up from regular paychecks. The car doesn’t only belong to the person who bought it, it belongs to each person in the marriage because it was bought with money earned while they were married.

Mixed Property

Sometimes items can be a mixture of community and separate property. This can arise if, say, one party owned a house before the marriage and sold it while married to their partner. Then, this person made a down payment on a new house. The down payment for the new house would still be considered separate property because the purchase was made with separate property finances. However, if the mortgage was paid with wages earned at a place of employment, the home is now a mixture of both community and separate property.

Reach Out to Fischer & Van Thiel, LLP

It can be extremely difficult to decide what property falls under each category. Our firm has extensive experience sorting out property during divorce proceedings and we can help you fight for the fairest property division agreement.

Schedule a complimentary consultation with us, please call (760) 722-7646 or complete our online contact form.