In California, the distribution of property is a major worry for couples going through a divorce. Since California is a community property state, many people are unaware that spouses would equally share any assets accumulated during the marriage. However, there are exceptions to this legislation. This article provides an informative guide to the distribution of property and how divorce impacts it.
What Is A “Property” In California:
To ensure that the property divide is as equitable as possible, all assets must be not only identified but also fairly priced. Any properties that have potential worth are considered assets in a divorce. According to California divorce laws, everything a couple owns jointly is called community property. Usually, this comprises all income generated, liabilities assumed, and assets accumulated throughout the marriage or domestic partnership.
What Are Different Property Types:
There are generally two main property division laws, community property and equitable distribution. However, the question of separate property also plays an important role in the distribution of property. Here is an overview:
According to the California Family Code, community property must be divided equally during a divorce. This doesn’t imply that every asset must be liquidated and the proceeds allocated equally. Instead, each divorcing party should be given assets from community property that are of equal value.
In California, a spouse’s separate property is anything they possessed before they got married alone, received as a gift or inheritance during their marriage, or gained through inheritance. Additionally, in most cases, the separate property also refers to things that were bought with it or traded for it, as well as earnings from it and any rise in its worth. Separate property does not typically get divided up during a divorce because it belongs to the spouse who owns it.
In equitable distribution, the property is not necessarily divided equally. A court may divide property unequally if it is fair and reasonable under the circumstances. The length of the marriage, each spouse’s financial contribution to the nuptials, each spouse’s income, and each spouse’s capacity for earning an income are common considerations.
Division Of Debts:
Debts are not always distributed in the same manner as property. Property is distributed “equally,” whereas debts are distributed “equitably.” In California, it’s important to consider the date of separation when dividing debts. After a divorce, the debts accrued by each spouse are regarded as separate property.
Separate debts are those one spouse accrues before or after the couple separates. These debts are completely the responsibility of the spouse who incurred them, and the other spouse is not liable for them. This indicates that the obligation will only be owed by the spouse who initiated it.
Division Of Business:
A buy-out, co-ownership, or sale of the business are the three most typical ways to separate a business following a divorce. The approach that is used the most frequently is a buy-out, in which one spouse purchases the other spouse’s ownership stake in the company. Another choice is to carry on co-owning the company after the divorce is finalized with a clear division of roles. The business could be sold as a final resort.
It’s critical to obtain trustworthy legal counsel if you’re considering divorcing or separating from your spouse. In separation agreements and divorce proceedings, alimony, child support payments, and property partition cost money. An experienced Orange County divorce attorney can describe what will occur before, during, and following a divorce or legal separation. Regarding custody, support, and property distribution, it’s typically in your best interests to speak with an experienced family law attorney.