California Law: Divorce and the Division of Assets and Debts
March 14, 2017
Divorces can be difficult for a variety of reasons. The history between a couple can be fraught, and difficult proceedings often require a combination of compassion and objective analysis regarding California divorce laws. This is why so many people seeking an experienced divorce lawyer in Los Angeles come to our office.
The division of assets and debts in a divorce can lead to many disputes and tensions. We'd like to consider how property is split in a divorce and how you can protect your own assets. To discuss this issue, we should first make a distinction between marital property and separate property.
Defining Marital Property and Separate Property
Simply stated, marital property refers to the assets and debts that a couple accumulates during their marriage together.
Separate property, on the other hand, refers to properties owned prior to a marriage or inheritance and gifts acquired individually during the marriage.
How Property Is Divided in the State of California
In the state of California, laws regarding community property state that the assets and debts that couples acquire during their marriage belong to both of them equally. Hence during a divorce, these assets and debts should be divided equally. This typically means:
Determining if an asset or debt is marital or separate
Agreeing on the value of the marital asset or debt
Determining how this marital asset or debt should be split
In ideal situations, the divorcing couple is able to agree on an equal division of these marital assets and debts. Of course, this is not always possible.
Disagreements on Property and Asset Division
When a couple disagrees on the division of marital property during their divorce, another party will need to make a decision about the division. This means that the couple will need to ask for a judge or arbiter to help with this process.
The Purpose of a Prenuptial Agreement
A prenuptial agreement can help with the division of assets and debts in the event that a marriage fails. By consulting a prenup, a couple, a lawyer, or an arbiter can determine the property and financial rights of each spouse in the marriage. This will often layout both separate property and marital property issues.
Not all married couples have a prenuptial agreement. This is what often leads to disputes over the property in the event of a divorce.
How Can I Protect My Assets Without a Prenuptial Agreement?
If you do not have a prenuptial agreement, there are some ways you can protect your separate assets and ensure fairness in dividing marital assets in the event of a divorce.
Keep Your Funds Separate – By keeping separate bank accounts even after marriage, you can ensure that your own earnings are strictly considered your own.
Keep Your Real Estate Separate – If you own property, keeping the deed to that property solely under your name can be quite helpful should there be any dispute over splitting the value of the property during a divorce.
Use Your Funds to Maintain Your Property – To keep the property truly your own, you may want to consider paying for the maintenance of your separate property using only your own separate funds.
Have Your Businesses Valued Around the Marriage Date – If you had a business before your marriage, be sure to have it evaluated around the date of your marriage. If your business appreciates in value, your spouse is entitled to half of the appreciation rather than half of the total cost of the business.
Save Bank Statements for Retirement Accounts – By saving a bank statement of a co-mingled retirement account around the time of the marriage, you can keep the initial amount that was your own while splitting the remainder with your former spouse.
Speak with an Experienced Divorce Attorney
For more information about your legal rights and options in a divorce and what you can do to protect your assets, be sure to contact an experienced family law attorney today. Our team will offer sound guidance in your time of legal need.