Divorce is a challenging and emotionally charged process, requiring careful consideration and resolution of various legal and financial matters. One critical aspect that often arises is property division in divorce. This encompasses a broad range of assets, including real estate, investments, bank accounts, vehicles, personal belongings, and more.
When a marriage comes to an end, couples must navigate the complex task of dividing their assets and debts fairly. So before you try to find a divorce lawyer near you in San Diego, this article will shed light on the intricacies of property division in divorce and provide essential information to ensure a smooth and equitable distribution of assets. Read on!
How is the property split in a divorce?
Starting the process of property division in a divorce begins with each party being required to disclose all their assets and debts on their Schedule of Assets and Debts (FL-142). Both parties exchange these forms to ensure equitable division.
How is property characterized for equitable division?
Separate property is property acquired before marriage or after the date of separation. This includes, but is not limited to, inheritance, gifts, rents, profits, or proceeds. Additionally, inheritance or gifts acquired during the marriage are also separate property.
The date of separation is determined by (1) the parties’ intent to end the marriage and (2) the parties’ conduct consistent with the intent to end the marriage i.e., living in separate residences.
California is a community property state. Community property is property acquired by spouses during marriage. There is the community property presumption that anything acquired during marriage is community property. This means you and your spouse have a 50/50 interest in the assets and debts acquired during marriage.
The characterization of bank accounts depends on when or how the account was acquired. If the account was opened during marriage, the account is community property. However, any bank account opened after the date of separation is separate property. An account opened prior to marriage, but with deposits made into it during marriage is also presumed to be community property.
If you and your spouse purchase a vehicle together during marriage, it is community property. If you and your spouse have multiple vehicles, a Court will look to see if there is any disparity in the values of the vehicles and then equalize the amounts due to each spouse based on the disparity based on which vehicle each spouse is taking.
If you and your spouse purchase a residence during marriage, it is considered community property. Upon divorce, spouses usually sell the residence and divide the net proceeds. This is the most financially viable option if neither you nor your spouse can afford the residence.
A second option is one spouse buying out the other spouse’s community property interest. Usually, a buyout is a one-half payment of the home’s equity to the other spouse and a modification of the home loan.
A third option is a deferred sale if you and your spouse have minor children.
Personal iInjury awards
The characterization of a personal injury award depends on when the cause of action arose, not when the proceeds are received. However, if the cause of action is against a party for personal injury, then the award is separate property.
When work is performed to earn retirement benefits between the date of marriage and the date of separation, then the benefits are community property. However, if the work is performed before marriage or after the date of separation, then the benefits are separate property.
When stock options are granted to an employee (spouse) before the date of separation but do not become exercisable until after separation, the court has broad discretion in apportioning the property.
Disability payments received after the date of separation and before retirement are separate property.
Severance pay is considered community property to the extent it was earned during marriage because like retirement benefits, it represents a form of deferred compensation.
Pets are treated as personal property and if acquired during the marriage, they are generally characterized as community property.
A transmutation is an agreement to either change community property to separate property, separate property to community property, or separate property of one spouse to separate property of the other spouse.
A valid transmutation must:
Be in writing;
Expressly declare a transmutation; and
Be made, joined in, consented to, or accepted by the adversely affected spouse.
What are the means to divide property in a divorce?
A premarital agreement is an agreement between a couple before marriage that contracts out of the community property presumption and allocates the couple’s assets and debts as if there was a divorce. To be valid, this agreement must be voluntary, signed by both parties, and in writing.
Property settlement agreement
A property settlement agreement is a written agreement between the parties outlining the division of marital property. Marital property includes real estate, retirement accounts, investment accounts, stock options, vehicles, bank accounts, and personal property.
A Court must divide all community, quasi-community, and quasi-marital property of the parties, unless divided by the parties in an agreement. Normally, the court has no authority to dispose of either spouse’s separate property, unless requested by either party. However, the court may confirm separate property to the owner spouse.
Who is a trusted divorce lawyer near me in San Diego?
Learn more about the Certified Family Law Specialist (CFLS) designation and why it’s important.
The Gold Standard of Attorneys
The Preeminent AV Rating from Martindale-Hubbell recognizes an attorney’s exemplary legal ability and professional ethics. Learn more about the founder of JWB Family Law, Jane Wesley Brooks, CFLS. Jane is a Certified Family Law Specialist with the California State Bar, and a Martindale-Hubbell® AV Preeminent Peer Rated lawyer.
The information and materials on this website are provided for general informational purposes only, and are not intended to be legal advice. We attempt to provide quality information, but the law changes frequently, and varies from jurisdiction to jurisdiction. The information and materials provided are general in nature, and may not apply to a specific factual or legal circumstance. An attorney and client relationship should not be implied. Nothing on this website is intended to substitute for the advice of an attorney; therefore, if you require legal advice, please consult with a competent attorney licensed to practice in your jurisdiction.