Community Property Law in California Explained

California is a community property ("CP") state. It is one of only nine other CP states in America. Under CP law, husbands and wives are deemed co-owners of property much like a partnership.

In California all the properties owned by a married couple fits into three categories. It is either (1) CP; (2) separate property; or (3) quasi-community property.

Whether a piece of property is community, separate, or quasi-community property will control the division of property upon divorce. Under California law CP is defined as all property, real or personal, wherever situated, acquired by married persons during the marriage while domiciled in the state.

Both spouses own property that is acquired between the beginning of the marriage and the date of separation. How can two people on one piece of property? Each owns a one half interest in the property.

Separate property is property that either spouse owns before the marriage, after separation, or property that was received during the marriage either by inheritance or gift.

For example, let's say that you received a large sum of money as inheritance from your rich uncle. The money is yours and will be considered separate property at divorce.

Income earned during the marriage will be deemed to community property unless it originates from separate property. This means that your income will be considered a property even if it's held in separate accounts.

Quasi-Community Property is a little trickier. It is defined under the law as: all real or personal property, wherever situated, acquired before or after the operative date of this code in any of the following ways: (a) By either spouse while domiciled elsewhere which would have been community property if the spouse who acquired the property had been domiciled in this state at the time of its acquisition.

(b) In exchange for real or personal property, wherever situated, which would have been CP if the spouse who acquired the property so exchanged had been domiciled in this state at the time of its acquisition.

In general, quasi-community property is a term that refers to property acquired by a couple when they lived in an equitable distribution state before moving to California. In California quasi-community property is treated like CP.

Now for the even trickier part: Sometimes separate property can become CP during the course of the marriage. This happens all too frequently and sometimes results in a nasty surprise during divorce.

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