TYPES OF PROPERTY:
Nearly all dissolutions of marriage will involve the division of property. California is a community property state and the courts recognize three different types of property:
1. Community Property: All of the assets (and debts) acquired during marriage will be deemed “community property.” All things being equal, each spouse is entitled to 50% of marital property. Virtually all property, money and assets acquired during the course of the marriage are considered marital property with few exceptions such as an inheritance. It does not matter which spouse earned the money to acquire the asset, who wanted it or who bought it- everything is deemed as community property (with a few exceptions).
2. Separate Property: This category includes assets that were purchased or owned before getting married. Gifts and inheritances are deemed separate property as is any asset that is acquired after the date of separation purchased with post-separation earnings or other separate property funds.
3. Quasi-community Property: If either of the spouse owned or purchased any asset in a different state before moving to California, it is considered quasi-community property.
DIVISION OF PROPERTY IN CALIFORNIA:
As for community property, the law in California favors a 50/50 split. All assets acquired during marriage is to be divided equally unless there is an agreement to the contrary. The net community asset is calculated by subtracting any joint obligations or debts from the total market value of assets and each spouse receives one-half.
Any employee benefit or retirement contributions that were started after entering into the marriage is also treated as community property and is to be divided equally. If the contributions or investments in retirement plan were made before getting married, that particular amount will be deducted before arriving at the amount to be distributed equally.
Pensions are divided one of two ways. One way is to divide the number of years of the marriage while contributing to the pension by the total amount of years that spouse has been employed with that particular employer. The other method involves ascertaining the present value of the pension and providing the non-pension spouse with a cash settlement or other equitable division of assets to make up for that value.
Separate property (assets acquired before marriage or after marriage, including inheritances) remains the sole and separate property of that spouse.
Property Division is a fundamental aspect of a divorce. Understanding your rights and those of your spouse can assist in resolving the issue of division of property without incurring unnecessary fees and costs.
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