How to Divide Debt & Property in Divorce

If you and your spouse are going through a divorce, you will have to decide how to divide up the property and accrued debts. California law states assets and debts that were acquired during the marriage belong equally to both of you, and they must be equally divided between you in the divorce. If you cannot agree on division of assets and property, it will have to be decided by a mediator or a Judge. This process can be lengthy and require an assessment of value by 3rd party assessors.

Steps in the Process of Division of Property and Debt

Whether you handle your own property division or a court handles it for you, there are three crucial steps to the process:

  • is the property and/or debt is marital or separate
  • the value for marital property or amount of debt, and
  • fair division of the aggregate property and/or debt.

California Law and Community Property

California law is very clear that assets and debts accumulated in the marriage are community property, and must be divided equally. Property owned alone before the marriage or gifted to one spouse during the marriage is not included in community property. As long as property ownership and dates can be proved with documentation, the court will not include any property, earnings, or increase of value in the divorce. Anything earned before the official date of separation is included in the divorce as community property.

Partial Community/Partial Separate Property

Many types of assets can be considered partially community and partially separate property, including retirement accounts one spouse contributed to before and after the marriage, or a business one spouse started before marriage and continued operating after marriage. Identifying community property from separate property can become very difficult, especially if one spouse owns a business or other asset to which the other contributed labor or funds during the marriage.

Resolving Disputes

If an agreement cannot be reached, the court will resort to assigning a monetary value to each item of property. Appraisals can help a couple determine the value of real property as well as items like antiques or artwork. Retirement assets can be very difficult to evaluate and may require the assistance of a C.P.A. or other financial professional.

Having an attorney to help you will become crucial in a divorce where there is significant community property and a dispute of the division. At the office of Charles D. Stark, Attorney & Counselor at Law we have over 40 years’ experience supporting people during a divorce and division of property. We can help you be sure you are represented to receive everything you should. Call us today at 707-623-1157 or contact us online to take the first step.

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