Nearly every divorce or legal separation will require the division of personal property, real estate, business interests and other assets/debts. The sum of this is known as the net community property. Community property is defined as assets/debts acquired during the marriage, and each spouse is entitled to 50% upon dissolution of the marriage.
This is not a comprehensive list, so be sure to consult an attorney if there is any question as to whether or not something can be considered community property.
What CANNOT Be Considered Community Property?
Assets/debts that aren’t considered community property – called separate property – are those, which are acquired before the marriage.
There are also assets that can be acquired during the marriage which are also considered separate property:
There are conditions to the aforementioned separate assets – they cannot be mixed with “community property funds” or they could be considered community property by the courts. This is called commingling. For example, if you receive an inheritance of $50,000 and deposit it into a bank account owned by both you and your spouse, the money could become community property. Instances of commingling are often very complicated, and should be reviewed by a community property attorney to be properly assessed and (if applicable) divided.
Property acquired in one spouses name – and not used for the benefit by the other spouse – can be considered separate property as well. For this to be applicable, there would have to be a signed agreement stating that the property is solely owned by one spouse. This is often a point of contention in divorce proceedings, and the onus is on the property owner to prove that both spouses agreed the property would be considered separate in the marriage. With no agreement in place, a court will consider the asset to be community property and divide it 50/50 between both spouses.
Dividing Up Community Property
During the divorce process, a judge or arbitrator will divide the community property equally between both spouses, assessed at the current fair-market value. This includes the debts and obligations, which are subtracted from the assets to yield the net community estate.
Unfortunately, many ex-spouses try to deceive the courts and circumvent the property division process by hiding or misrepresenting their assets. This involves unknown/offshore bank accounts, transfer of assets to a 3rd party, falsifying debt and other fraudulent courses of action.
Providing an incomplete disclosure of your assets is never a good idea. While financial disclosure is often done in good faith, if your spouse or their attorney’s notice a discrepancy or omission they will try and locate and valuate these hidden assets.
The court system and discovery process have many mechanisms to locate hidden assets. If you are found to be concealing any assets from the divorce proceedings, a California judge/arbitrator has the authority to award ALL of those assets to the other party, as it constitutes a breach of fiduciary duty to your partner as outlined in your marriage contract.
Speak To A Rancho Cucamonga Community Property Divorce Lawyer Today
Divorce proceedings and division of community property can often be a messy affair. There is a high level of emotion involved, as community property often represents the financial and retirement security of both parties. For your interests to be protected, it is important that you speak to a Rancho Cucamonga community property lawyer with extensive experience in family law.