Divorces can be messy especially when it comes to property division. No one wants to give up the assets that they feel are rightfully theirs. However, California uses a fair and reasonable calculation for property division. This article will answer all of your questions regarding property division in California.
What is Marital Property?
California defines marital property as any assets or income the couple acquires during their marriage. Separate property is any property that one of the parties had before the marriage or during the marriage by gift, devise, or bequest. Also, anything one of the parties acquires after the parties separate is not marital property.
The clear distinction between marital and separate property makes most decisions easy on the court. Although, there are some instances that are more complex. For instance, a business that one party owned before the marriage but both parties worked on while married. Another example is a property that belonged to one spouse before the marriage, but both spouses shared during the marriage. You should discuss these more complex issues with your attorney. An attorney can help inform you of all of your options and the best way to proceed.
California Property Division Laws
California family courts consider all property as well as debt distributable. This includes any property and debt that the couple acquires during the marriage. The court assumes that anything the couples acquire during their time together belongs to both of them. For one party to prove that they are the sole owner of a piece of property, they must present evidence to the court. These types of evidence include a deed, title, or written agreement between the two parties.
In a divorce in California, the couple will have a say in the distribution of property. However, if the couple can not reach an agreement, the court will step in. It is best for both parties to make a decision on how to divide marital property without the court’s intervention. This ensures that both parties are happy with the agreement.
California courts will look to make property division even. This means that if one party receives the marital home, then the other party will receive property that has equal value.
The court will treat debt the same as it does property. Any debt that a couple incurs while they are together will be split. Furthermore, any debt that one person incurs for necessities for themselves or children after the end of the marriage can also be split. However, the court will not consider any debts for non-necessities.
What About a Prenup?
A prenup or prenuptial agreement is a contract between the couple that outlines what happens during a divorce. If one of the spouses has a high net worth or property that they want to protect during a divorce, a prenup could be a good option. A prenuptial agreement could effect the division of property during a divorce.
Prenups were once only for the rich and famous. However, in recent years the popularity of prenuptial agreements has grown. These agreements often include morality clauses for things like infidelity. In the absence of an agreement, the couple will have to reach an agreement.
Pensions and Retirement Accounts
You may think that your pension or 401k is safe during your divorce. However, the part that you accumulate during the marriage is community property. California classifies retirement benefits in two categories.
- Defined Contribution Plans: A defined contribution plan is one in which an employee or their employer make defined contributions. While the value constantly fluctuates, it is definable at any moment. Examples of such plans include 401Ks and 403Bs.
- Defined Benefit Plans: These retirement plans are promises by an employer to pay a benefit to an employee at some point in the future. Because the basis for many of these plans is the salary of the employee at the end of their career, it is difficult to calculate a value. In these cases, an expert will have to determine the exact values of the retirement plan. An example of a defined benefit plan is a pension.
There are two options available when it comes to retirement plans. The first is a reservation of jurisdiction. A reservation of jurisdiction will split the benefits when they are paid. The other option is for the spouse who owns the retirement plan to pay the proportionate amount to the non-owner.
Hire an Attorney
As you can see property division in California is no small task. There are many things to consider when distributing property. An attorney can tell you what to expect as well as what would be best for you. Contact Bansmer Law today to learn how we can help.