Is An Inheritance Subject to Distribution Under California's Community Property Laws?
During a divorce, one of the most difficult tasks is determining what assets are marital property and what is separate property. Everyone who has watched the news or any legal dramas knows California is a Community Property state, meaning all marital assets are divided equally between spouses. The question most people have is what is separate property, and therefore not subject to be being divided?
To know what separate property is, you must understand what community property is. Community property is any property acquired by either spouse during the marriage, regardless of who holds the title. However, there are exceptions based on pre or post-nuptial agreements, which can stipulate that property that would have otherwise been considered marital property would remain separate.
If you are going to put a pre or post-nuptial agreement in place, you should do so with the advice of an experienced family law attorney. It is possible to challenge the agreement, and the judge can set it aside if they feel the agreement was coerced or unfairly benefits one spouse. There are a number of factors involved in pre-nuptial agreements and they are governed by Family Code §1600 et seq. Post nuptial agreements are governed by Family Code §1500 et seq.
Separate property are assets that remain one spouse's property and are not subject to being divided during a divorce.
Assets that are separate property include:
Anything you earned or owned (or debt) from before you married or after you separated
Anything you buy with separate property or you earn from separate property retains its separate character.
Gifts or inheritance, even if it was given or inherited when you were married generally remains separate property.
Sometimes, a property can be part community property or part separate property. For example, if a spouse buys a property and makes the down payment using funds earned before marriage, the new property is considered separate. However, if the mortgage is paid using marital funds, then the equity in the property is partially separate property and part community property. It could be considered commingled when separate property and marital property mix, whether it is real estate or a bank account. Commingled property retains its original character but has claims belonging to the separate or community along with it.
Determining what is separate property and what is marital property can become extremely difficult to figure out, and it is recommended that you work with an experienced family law attorney who can represent your rights and protect any assets that are legally separate property while ensuring that all marital assets are properly accounted for when it comes to dividing assets.