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Determining what is separate property in a divorce

When California residents begin the divorce process, a major part of it will be the division of property. In some cases, that division might be simple and straightforward. In other cases, particularly in cases of high-asset divorce, there might be questions about separate and community property as well as how to address commingling assets.

Separate and community property

When it comes to assets and debts, California is a community property state. This means that all property acquired and all debt accrued during the marriage belong to both spouses. The exceptions to this are gifts and inheritances. Separate property, then, refers to all property acquired before marriage and after the date of legal separation. When negotiating high-asset division in divorce, couples need to clearly identify what is community property and what is separate property. This also applies to debt. However, in many cases, couples might run into the challenge of dividing commingled property.

What is commingling?

Commingling is when a property has parts that fall under separate property and parts that fall under community property. While community property is divided 50-50, commingled property needs additional analysis of the values of each part before deciding what each person gets. Some examples of community property can include:

  • Retirement accounts with contributions before and during the marriage
  • A house bought during the marriage but using a down-payment from savings accrued by one person before the marriage
  • One person buying a car during the marriage using money from an inheritance they received
  • Paying for repairs for the couple’s home from money one of them had saved before the marriage

Commingling complicates things because each part’s value must be carefully calculated before the division of property can be decided. In those cases, it might be best to have the help of both a family law attorney and a financial professional.