
Property and Debt Division FAQ
From the Nolo.com Divorce & Child Custody Center
How property and debts are divided when you get
divorced.
How is property divided at divorce?
It is common for a divorcing couple to decide about dividing their property
and debts themselves, rather than leave it to the judge. But if a couple
cannot agree, they can submit their property dispute to the court, which
will use state law to divide the property.
Division of property does not necessarily mean a physical division. Rather,
the court awards each spouse a percentage of the total value of the property.
(It is illegal for either spouse to
hide assets in order to shield them from property division.) Each spouse
gets items whose worth adds up to his or her percentage.
Courts divide property under one of two schemes: equitable distribution
or community property.
- Equitable distribution. Assets and earnings accumulated during
marriage are divided equitably (fairly). In practice, often two-thirds
of the assets go to the higher wage earner and one-third to the other
spouse. Equitable distribution principles are followed everywhere except
the community property states listed just below.
- Community property. In Arizona, California, Idaho, Louisiana,
Nevada, New Mexico, Texas, Washington and Wisconsin, all property of
a married person is classified as either community property, owned equally
by both spouses, or the separate property of one spouse. At divorce,
community property is generally divided equally between the spouses,
while each spouse keeps his or her separate property.
How do we distinguish between community and non-community property?
Very generally, here are the rules for determining what's community property
and what isn't:
- Community property includes all earnings during marriage and
everything acquired with those earnings. All debts incurred during marriage,
unless the creditor was specifically looking to the separate property
of one spouse for payment, are community property debts.
- Separate property of one spouse includes gifts and inheritances
given just to that spouse, personal injury awards received by that spouse,
and the proceeds of a pension that vested (that is, the pensioner became
legally entitled to receive it) before marriage. Property purchased
with the separate funds of a spouse remain that spouse's separate property.
A business owned by one spouse before the marriage remains his or her
separate property during the marriage, although a portion of it may
be considered community property if the business increased in value
during the marriage or both spouses worked at it.
- Property purchased with a combination of separate and community
funds is part community and part separate property, so long as a
spouse is able to show that some separate funds were used. Separate
property mixed together with community property generally becomes community
property.
Who gets to live in the house during the divorce?
If children are involved, the parent who spends the most time with the
kids, or provides their primary care, usually remains in the marital home
with them. If you don't have children and the house is the separate property
of just one spouse, that spouse has the legal right to ask the other to
leave.
If, however, you don't have children and you own the house together,
this question gets tricky. Neither of you has a legal right to kick the
other out. You can request that the other person leave, but he or she
doesn't have to. If your spouse changes the locks, or somehow prevents
you from entering the home, you can call the police. The police will probably
direct your spouse to open the door. When you both own the home, the only
time you can get your spouse to leave is if domestic violence has been
committed and a judge grants a restraining order.
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