One of the most challenging issues facing a divorcing couple is how to divide the property of the marriage. Some couples can agree on how all the assets should be divided, and there is no law that prohibits them from making their own choice. It’s when couples can’t agree that laws will guide or order how the property of the marriage is distributed. In California, the division is based on “community property,” equally dividing marital property and leaving each spouse with their own separate property.
Is It Community Property or Separate Property?
The first step in the process is to determine whether an asset or debt is community property or separate property. California law presumes that anything acquired during the marriage is community property, but there are notable exceptions. For example, anything that is inherited or gifted during the marriage is separate property. It’s not always so simple because if the non-titled spouse works on the property to increase its value or marital funds are used for this purpose, it can be converted to community property. The date the couple separated can impact a determination of whether a specific asset or debt is community property or separate. Most courts will tend to consider the asset or debt community property if it’s a close call.
How Much Is the Property Worth?
When a couple doesn’t know or can’t agree on the value of an asset, the property must be appraised. If a spouse is contemplating a buyout of the marital home, the value of the home must be assessed by qualified real estate professionals based on similar homes in the area. Artwork, antiques and other tangible assets can be appraised by a professional. Some financial assets, such as a retirement plan, may require evaluation by an accountant.