Real property (real estate) or personal property (money, jewelry, art, stocks, bonds, etc.) given by one spouse to the other spouse during marriage is generally presumed to be a gift, and is the receiving spouse’s separate property. Such a gift includes all income and property from the gifted property—such as stock splits resulting in new shares of stock, and stock dividends paid. Because such transfers of property are separate property owned by the receiving spouse, the spouse who gave or gifted the property during the marriage generally cannot recover it or seek a credit or offset for it against the marital or community property.

But laws on spousal gifts during marriage vary from state to state, and especially with gifts that are substantial in value in relation to the income and assets of the spouses. And in some states the character of property as (1) separate property or (2) community or marital property can be permanently changed if there was a transmutation of the property by written agreement of the parties—an agreement in which the property was transmuted from community property to separate property, for example. A transmutation of real property may have to be recorded in the county records to be effective.

Laws regarding the characterization of property given by one spouse to the other spouse during marriage, and any transmutation of the property, are generally located in a state’s statutes, and often in the family or domestic relations code.

In New York, property acquired during a marriage is typically considered marital property, which is subject to equitable distribution in the event of a divorce. However, gifts from one spouse to another during the marriage are generally presumed to be separate property of the receiving spouse. This includes any income or additional property derived from the gifted property, such as stock dividends or splits. New York does not follow community property laws, but rather equitable distribution principles, which means that marital property is divided in a manner that is fair but not necessarily equal. While substantial gifts might raise questions regarding their nature, the default assumption is that such gifts are separate property unless proven otherwise. Transmutation of property, where the character of the property is changed from marital to separate, can occur in New York through a written agreement between the parties. This agreement must be clear and acknowledged in a manner required for a deed to be recorded, which is typically in writing and with the formalities of a contract. It is important to note that the laws governing these matters can be complex, and an attorney can provide specific guidance based on the individual circumstances of a case.