property Issues in California divorce

Asset - property Issues in California divorce

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What is community Property?

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Asset

California is a community asset state in which spouses are entitled, with some exceptions, to an equal department of community asset and debts in a separation (called dissolution in California).

Community asset is all property, in or out of state, that either spouse acquired during the marriage through the efforts of either spouse or with community asset funds. This means that, even if only one spouse worked during the marriage and the other stayed at home raising children, both spouses are entitled to one half of the community property. "During marriage" refers to the time duration from the date of marriage to the date when the parties legally separate. The date of separation is often contested because it determines the extent of the community asset estate. The courts have said that separation occurs where one spouse subjectively intends to end the marriage and does something to evidence that intent. It could be lively out of the house home, telling your spouse the marriage is over, arranging for a new place to live, etc.

What is detach Property?

The parties are entitled to keep their detach asset which is not divided in a dissolution. detach asset is any asset that is acquired before the marriage, along with any rents or profits received from those items; asset received after the date of separation with detach earnings, inheritances that were received before or during marriage; and gifts solely to one spouse.

Do debts and credit cards also have to be divided?

Debts are also classified as either community or detach asset debts. With few exceptions, debts incurred during the marriage are community asset debts that will be divided equally in the dissolution. It does not matter whose name is on the debt.

For example, credit card debts incurred during the marriage are community asset debts regardless which spouse's name is on the credit card. Learner loans are one of the main exceptions to this rule. In unavoidable circumstances, the community may be entitled to a re-imbursement if the concentrate pays off one spouse's Learner loans during the marriage. Debts that you incurred before marriage or after separation are detach asset debts.

What happens to the house Home?

The house home in California is often the marriage's most indispensable asset. The department of the house home can be complicated if there are minor children and one spouse wants to stay in the home. The community asset interest in the home is supplementary complicated where the asset is in the name of one spouse and was acquired prior to the marriage but the mortgage payments have been paid from community earnings. Parties should also be aware that if one spouse remains in the asset after separation they may be incurring indebtedness to the other party if the fair rental value of the asset exceeds the mortgage, taxes and assurance payments on the home. These are called Watts claims. The reverse may also be true. If the spouse living in the house is paying the mortgage which exceeds the fair rental value, they may be entitled to what's called Epstein credits.

Am I entitled to a share in my spouse's pension?

Another indispensable asset in a marriage is a pension or retiremement plan. The non-employee spouse is entitled to a part of the plan that was earned during marriage. To ensure that any pension hamlet is enforceable it is advisable that any settlements concerning pensions are contained in a "Qualified Domestic Relations Order" (Qdro) signed by the Court.

How do I form out the extent of my husband or wife's property?

Each party is required by California law to file a first and final "declaration of disclosure" with the Court that they have served an wage and cost announcement and schedule of Assets and Debts on their spouses. The final announcement can be waived by the written deal of the parties. The disclosures will list each spouses community asset assets and debts and detach property. Most disputes involve the extent and valuation of community asset assets. If a spouse tries to hide assets, your attorney can employ discrete discovery tools forcing a spouse or a third party to turn over financial records. For example, they can subpoena the records of third parties such as banks and Cpa's. In complicated cases it may be indispensable to employ the services of a forensic accountant. It is a good idea to minimize this risk by taking some uncomplicated steps as part of any pre-divorce planning. You should make copies of leading financial documents such as tax returns, W2's, bank and brokerage statements and keep them in a safe place.

The law requires the parties to make full disclosure of all their assets and liabilities and also any business investments and opportunities. The case of Marriage of Rossi, illustrates what can happen when one party tries to conceal assets. In 1996 Denise Rossi won .3 million in the California State Lottery. She chose to conceal the winnings from her husband and filed for a separation 11 days after learning of her winnings. She had been married for 25 years. 2 years after the case was over and a Judgment had been entered, her ex-husband discovered that his ex-wife had won the lottery. He filed a motion and the judge gave all of the .3 million dollar lottery winnings to the husband, since the wife had intentionally not disclosed her winnings in the separation proceedings. News reports indicate that Denise ended up filing for bankruptcy.

Don't forget some often overlooked assets!

Some assets that are de facto overlooked but may turn out to be indispensable include:

o Tax refunds

o Frequent flyer miles

o Season tickets

o Prepaid insurance

o Vacation pay

o Club memberships

Are their tax consequences of a asset settlement?

It's leading that you reconsider the tax consequences of any asset settlements during a dissolution. Generally, Irc section 1041 provides that transfers to a old spouse incident to a separation are not taxable. However, if either spouse agrees to sell an asset as part of a hamlet there may be a tax consequence. For example, if parties agree to sell the house home and divide the net proceeds they may have to pay capital gains tax on any gain. The Tax Reform Act 1997 gives each spouse a 0,000 exemption from gain realized on the sale or change of the indispensable residence. Similarly, the tax consequences of distributions from pension plans now or in the hereafter should also be considered.

I hope you receive new knowledge about Asset. Where you may put to use within your daily life. And most of all, your reaction is passed about Asset.