Division of Marital Property
Dividing Community Property in Divorce
If you are going through a
divorce, it is important to understand your rights in regards to marital property
division. Hanson, Gorian, Bradford & Hanich can provide the counsel
and representation that you need. Our
family law team includes a Certified Family Law Specialist, of which there are only
around 30 in the Riverside area. Attorney Danica Hanich is a Certified
Family Law Specialist with the California Board of Legal Specialization.
She can provide the expert advice and guidance that you need.
Understanding Property Division in CA
California is a community property state, which means that any property,
assets, or debts acquired by either party during the marriage will be
considered marital property, subject to division and distribution unless
otherwise specified by a
prenuptial agreement or
postnuptial agreement. State law also states that marital property is to be divided evenly rather
than equitably. Some states divide property by the principle of equitable
distribution, which operates on more of a fairness principle than an even split.
This division may put one spouse into a financial bind post-divorce, because
their ex ended up with more. This is where
spousal support comes into play. When one spouse makes a better income than the other
spouse, that spouse will likely be required to pay monthly amounts to
the lower-income spouse in order to support them. In this way, an uneven
property division will not have an adverse effect.
While there are a few exceptions to this rule. In general, all marital
property will be divided evenly in the event of a divorce. This does not
mean each and every asset must be split and divided, but rather, the total
value of your marital assets, minus any debt, must be divided and distributed
equally. While this concept may seem cut-and-dry, determining what is
separate property and what is marital property can sometimes be complex.
Consult with a divorce lawyer in Riverside to ensure you have the best chance of a positive outcome for your case.
Declarations of Disclosure
Couples in California must submit detailed financial statements to each
other within 60 days of filing for divorce. The purpose of submitting
such disclosures is to help put “all the cards on the table,”
so to speak, so that both parties are on the same page and can more quickly
and efficiently work towards an agreement regarding the distribution of
their assets and debts.
Declarations of disclosure are comprised of the following forms:
Preliminary Declaration of Disclosure: This is essentially a checklist that states that the required documents
are attached. This form references the following SAD and IED forms as
well as requires the spouse completing the form to attach the most recent
two years’ tax returns. Any additional information about business
opportunities or obligations that may have arisen during the marriage
that are not included in the following forms must be included.
Schedule of Assets and Debts (SAD): This is a four-page long form that requires the spouse completing the
form to provide all relevant information regarding any items they have
an ownership interest, even if their name is not on the asset or obligation.
This includes real estate, personal property, jewelry, vehicles, bank
accounts, investment accounts, retirement accounts, items in safe deposit
boxes, business interests, stocks and bonds, and all debts. Many assets
and debts listed on the SAD must be backed up by supporting documents.
Income and Expense Declaration (IED): The IED is another four-page form that requires the spouse to disclose
current information regarding their income and expenses. This includes
information about the spouse’s employer, current earnings, tax filing
status, degrees and licenses, commissions, overtime, benefits, net value
of all property and liquid assets, monthly expenses, and attorney’s
fees. If the spouses have children, information about the amount of time
the child spends with each parent is also included.
If additional information is needed, it is obtained during a process known
as discovery. This can involve depositions, interrogatories, requests
for production of document, requests for inspection, and subpoenas. Our
firm’s attorneys are highly experienced with approved methods of
discovery and can walk you step by step through this process.
Marital vs. Individual Property in CA
Once all assets and debts are made known, they are then separated into
two categories: marital and individual property. In general, marital or
community property is everything that the spouses acquired during the
course of their marriage unless an agreement was made otherwise. For example,
money you earned at work and put into a joint account is considered marital
property, as is anything that was purchased using these funds. Community
property is usually divided equally between spouses.
Individual or separate property only belongs to one spouse. Separate property
is anything that a spouse owned before marrying their spouse or was acquired
after the date of separation, including money earned. Any inheritances
or gifts acquired by one spouse during marriage are also considered separate
property, as are any assets purchased using separate property.
Separate property can become marital property, however, if it is comingled
with marital property. For example, if a spouse’s separate savings
account can become marital property if their spouse deposits money into
it during the marriage. Similarly, a separately owned house can become
marital property if both spouses pay its mortgage or other related home
expenses, such as utilities or repair costs.
Dividing Debts During Divorce in California
Debts are subjected to the same rules as assets and must be classified
as being community or separate. Both spouses have an equal obligation
to all community debts, even if it was only incurred by one of the spouses.
For example, if your spouse were to rack up a considerable amount of credit
card debt during your marriage, even if the card is only in their name,
the debt belongs to you too.
Debts can also be separate, though this is rare. Credit card debt incurred
after the date of separation is considered separate. If you are unsure
whether your debt is community or separate, we urge you to
contact our office and discuss your concerns with one of our skilled attorneys today.
Splitting the Home, 401(k) and Other Assets
Property division gets complicated when it comes to large items such as
a family home, a retirement fund or even stocks and bonds. One common
question that divorcing couples face is "Are there any exceptions?"
Say, for example, that a husband owned a home prior to marriage, but the
wife made a majority of the mortgage payments because the husband lost
his job or moved out of the home. This may be a case in which a court
would unevenly split the price of the home. The home may even be granted
to the wife in this situation if she was granted custody of the children,
and the court deemed that the children should stay living in the home.
Individuals may wish to cash out their 401(k) or other accounts so that
they cannot be subject to division. Once divorce paperwork is filed, it
is illegal to attempt to hide or conceal any assets. At this point, everything
is up for division.
These situations can get increasingly more complicated if there are special
exceptions to the rule. For example, say you owned a business prior to
marriage, but your business' assets grew significantly in value while
you were married: Are the increased assets considered marital property
or separate property? A knowledgeable Riverside divorce attorney can meet
with you to explain your rights under state property laws and help you
exercise those rights in court or during
mediation. By procuring the services of our family law firm, you can trust that
we will do our best so that you keep what you are entitled to keep.
Don't get cheated out of your assets.
Contact us for experienced counsel!