Separate property is generally property that a spouse acquired before marriage—or acquired by gift or inheritance during marriage—and is not subject to division upon divorce. In contrast, marital property is generally property that is acquired during marriage, is jointly owned by the spouses, and is subject to division upon divorce—whether the spouses reside in (1) an equitable distribution or common law property state or (2) in a community property state.
Community property states generally include Alaska, Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. In these states, divorce courts generally start with the presumption that the marital property is owned equally by the spouses and will be divided equally upon divorce.
In other states—so-called equitable distribution or common law property states—the divorce court attempts to divide the spouses’ assets equitably (fairly) and may consider a spouse’s separate property in deciding to make an unequal division of the spouses’ marital property. In practice, the difference between the division of assets in community property states and in equitable distribution states is sometimes not as great as it may seem, as the court in a community property state may have the discretion to divide the spouses’ community property on a 60-40, 70-30, or other unequal basis.
In California, which is a community property state, the law presumes that all property acquired during the marriage is owned equally by both spouses and is subject to equal division upon divorce. This includes income earned by either spouse and assets purchased with that income. Separate property, on the other hand, includes assets acquired before marriage, as well as gifts or inheritances received during the marriage, and is not subject to division in a divorce. However, the distinction between separate and community property can be complex, especially if separate property becomes commingled with marital assets. In some cases, the court may have discretion to divide community property unequally, based on factors such as the economic circumstances of the spouses, contributions to the education or career of the other spouse, or other considerations that make an equal division unreasonable. It's important for individuals going through a divorce in California to understand how their property will be characterized and potentially divided, and they may benefit from consulting with an attorney to navigate these issues.