Jack and Jane met, fell in love, got married, and bought their dream home. Investments grew, babies were born, and Jane left her dream job to become COO of the household while Jack continued working. Aside from estate planning documents, Jack and Jane never put any agreements in writing.
Now, Jack and Jane are getting divorced and want to know, are the house, Jack’s income, and the credit card debt community property?
Here’s what they should learn from their attorneys.
California is a Community Property State.
Absent a valid agreement between spouses or domestic partners, the marital property rights of California domiciliaries are fixed by California community property law. (People are domiciliaries of California if they are physically present in the state and intend on remaining here indefinitely.)
Subject to exceptions, “community property is all property acquired by a married person during marriage while domiciled in California, regardless of whether the property is real or personal and no matter where it’s located.” California Family Code Section 760
Spouses may co-own property as joint tenants, tenants in common, community property or community property with right of survivorship. They may not, however, own a piece of real property as community property and joint tenants, or community property and tenants in common.
Spouses’ respective interests in community property are “present, existing and equal”, not “exclusive” interests in only half of the community property. Spouse’s respective interests in joint tenancy or tenancy in common property are separate property. California Family Code Sections 750, 297.5
Jack and Jane acquired their house during marriage so, it’s presumptively community property. If title was taken as joint tenants or tenants in common, each spouse’s interest in the house is his or her separate property to be apportioned according to the language in the deed.
If Jack or Jane signed a property deed or estate planning documents after January 1, 1985, that contained language expressly stating the characterization of the house was changed from community to separate property; the house is the separate property of the benefited spouse if he/she overcomes a presumption of undue influence.
Is Jack’s salary earned during marriage community property?
It’s the public policy of the state of California that marriage is an equal partnership and “spouses devote their particular talents, energies, and resources to their common good.”
Unless otherwise agreed in writing, compensation for a spouse’s labor, time or skill during marriage and before separation is community property, and may include wages, salary, stock in lieu of salary, employer contributions to an employee profit-sharing plan, incentive stock options, vacation pay, deferred compensation, pension, and other employment fringe benefits.
Jack’s income earned during marriage is community property.
If you’d like California community property law explained, and applied to the facts of your life, please call Laura at 415-968-3028 or complete the form below and schedule a consulting session.