Community property is a state law designation assigned to income earned and property acquired and owned by married couples regardless of which spouse earned or acquired the assets.  Debt(s) acquired during marriage can also be considered community property.  Examples of community property include property earned or acquired during marriage such as land and real property;  personal property such as car, family or vacation home, boat, and computer; savings and investments; and retirement accounts.  Separate property that has become so intertwined with community property may also be designated as community property.

Community property law is different than common law systems which also make determinations about who owns what property and how it is to be divided.  Common law systems look at the name on the deed, registration, and other documents to tell which spouse or person owns the property; if property is in the name of two persons, the common law state may determine that each person owns a half interest in the property; and if property does not have a name on it, the common law state may look to who paid for the property to determine who owns it.  So, it is important to know whether a state is a community property state or whether common law applies to determine ownership and division of property.

Community Property states

The following states are community property states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Texas.  While only nine states are community property states, other states have adopted some form of community property law.  It is important to check the law of the state to learn how the community property laws works because some state’s law may simply provide that each spouse owns half of all property and other state’s may make an equitable division of all property.  Also, issues and disputes may have to be decided in a state different then where property was acquired when one or both spouses move, die, or transfer assets from one state to another.

Non-Community Property

Not all property acquired during a marriage will be designated community property.  This type of property is called separate property which means that it belongs to only one spouse.  Examples of property that may not be designated as community property include gift(s) received before or during marriage; inheritances received before or during marriage; property acquired prior to marriage which the acquiring spouse chooses to designate as community property; property acquired by one spouse during marriage using separate property assets with the intent that it be separate; and property that the spouses agree in writing is separate, so long as the writing meets the state’s standards for that type of agreement; and personal injury awards for pain and suffering, but not for repayment of lost earnings during marriage.