California is a community property state, meaning that it recognizes all property and debt acquired during a marriage to belong to both spouses. When dividing property, California courts divide community property as evenly as possible. Likewise, each spouse retains his or her separate property.
But there are times when a spouse may forfeit the right to his or her separate assets. Understanding California property division laws can help you prevent this from happening to you.
Defining separate property
California law defines separate property to be assets that a spouse owned before the date of marriage, acquired after the separation date or acquired as an individual gift or inheritance. But sometimes the line between these assets blurs.
Separate property may be vulnerable during a divorce if the owning spouse has not taken adequate measures to keep those assets separate.
Compromising separate property
Separate property may become community property if you combine it with other assets or manage it communally. You may do this by depositing the money into a joint account or otherwise mixing the assets with marital property.
You could also compromise your property by paying for joint marital expenses in such a way that it could belong to both of you. For example, if you use your inheritance money to purchase a house for you and your spouse, a court may consider it to be community property unless you are able to trace and prove it was paid from separate property funds. Similarly, if you routinely use your personal funds to pay for joint expenses, a court could potentially consider all or part of those funds to be marital property.
Disputing separation dates
Disputes about your separate property may also arise if you and your spouse do not agree on your separation date. If you acquire assets in September, for example, and your spouse claims that you did not separate until October, those assets could be vulnerable in court. For this reason, it is a good idea to settle on an official separation date before acquiring or purchasing real property. Some couples even dispute this in a prior court case before following through on divorce.