Property Division

What is community property?

Community property is everything that a husband and wife own or acquire from the beginning of their marriage until the date of their separation. In community property states, any income earned and property acquired during the course of the marriage is deemed to be owned by both spouses regardless of who actually earned or acquired it. Likewise, any debt acquired during the marriage will be deemed community debt without consideration of which spouse actually acquired it.

What is separate property?

Separate property is anything owned individually (separately) by one spouse. Spouses can indicate that something is separate property by both spouses indicating the status in writing. Spouses may also incur separate debt by showing that the creditor was only looking to one spouse (or that spouse's separate property) for repayment. However, separate property is usually limited to property owned before the marriage, gifts or inheritances, and post-separation earnings.

What about the house?

In almost all circumstances, the primary home of the family is considered community (or marital) property. When determining division of marital assets, the court considers many things. Keeping the home is viewed as tantamount to providing stability when children are involved and the parent awarded primary custody will most often remain in the home. If children are not involved, it is more likely that the home may be sold. However, adjustments in maintenance and alimony can be made to avoid selling it.

I inherited money from my parents during the marriage; will this be included in the marital property?

Gifts and inheritances are generally considered separate property. However, if it was received during the marriage, it must have been received and maintained as separate property.

What happens to my pension?

Pensions earned during the course of the marriage and that are vested at the time of the separation are usually considered a part of the marital assets. Meaning, the spouse who did not earn the pension will generally have a right to a portion of the vested proceeds. However, the courts are still divided on pension benefits that have not vested at the time of the separation.

What is a QDRO?

A Qualified Domestic Relations Order (QDRO) is a court order which allows payouts from a retirement plan to a former spouse. The QDRO is necessary when dividing a retirement account pursuant to divorce proceedings due to the restrictions placed on pensions by Internal Revenue Code and Employee Retirement Income Security Act (ERISA). A QDRO is necessary to assure that a former spouse may receive benefits as an alternate payee, because without it the benefits may only be paid out to the individual employee who earned the benefits.

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