The definition of community property, also known as marital property, is a legal distinction of a married individual’s assets that states that property acquired by either spouse during their marriage is considered to being to both partners of the marriage. Community property is a state-level law.
In community property jurisdictions, community property includes any income received by either spouse during the marriage, debts (acquired during the marriage), IRAs, vehicles, homes, furniture, appliances, and luxury items. Gifts and inheritances are not included. Assets acquired before marriage are not considered to be community property; however, these assets can be commuted to community property depending on the jurisdiction. Generally, assets will be split 50/50 in a divorce court in a community property state unless a different arrangement is agreed upon. The length of a marriage does not matter in community property states, whether the marriage lasted for a few months or 20 years. A prenuptial agreement will almost always override a community property law.
Community property law states directly contradict common law states, where property acquired by one member of a married couple during their marriage belongs solely to that person unless the property is specifically put in the names of both spouses. Dower and curtesy are abolished in all nine of the community property states, but exist in some common law states. Dower and curtesy are a surviving spouse’s right to receive a set portion of the deceased spouse’s estate. Dower refers to the portion to which a surviving wife is entitled and curtesy refers to what a husband is entitled to.
There are currently nine community property states:
Alaska can be considered to be community property or common law hybrid states. Couples can sign a joint agreement to elect to treat their assets and debts as community property. Including Alaska, there are 41 common law states. Rules of community property vary slightly in each of the nine states. The information presented below is not intended to be legal advice. It is best to consult a divorce attorney to receive the most accurate information on community property laws in your state.
Community property is recognized in Arizona and is classified as all property acquired by either spouse during their marriage except if one spouse acquires a gift or inheritance or property acquired after a divorce, legal separation or annulment. Additionally, real and personal property owned by one spouse before the marriage and any rent, profit or increase in the value of that property is classified as separate income. Property purchased by a married couple who lived in a non-community property state is considered by law in Arizona as quasi-community property and shall be fairly and equitably divided by the court. Dower and curtesy are abolished in Arizona.
California is a community property state mandating a 50/50 split upon divorce on all income received by either spouse during the marriage, all property, and all debt incurred during the marriage. In California, each physical object or asset does not need to be split equally; rather, the law requires that the net value of the assets received by each spouse must be equal (for example, one spouse might receive the house and the other might receive the family business). There is no estate by dower or curtesy. Gifts and inheritance are considered to be separate income as long as they are not deposited into a joint account.
Community property is recognized in Idaho. In Idaho, property acquired during a marriage is jointly owned by both spouses, regardless of who purchased it or whose name is on the title. Community property also includes income earned during the marriage, including stock dividends, salary, investment interest, and retirement benefits. Idaho defines separate property as property acquired before marriage, gifts or inheritance, property one spouse bought using separate-property funds, money earned while one spouse domiciled in a separate-property state, or all property listed in a pre-/postnuptial agreement. Idaho law states that separate property must be kept separate from other assets. Both dower and curtesy have been abolished in Idaho.
Louisiana is a community property state. Separate property in Louisiana specifically includes inheritance and gifts, damages or other indemnity awarded to a spouse in connection with the management of his separate property, assets acquired by the spouse with separate property or with a mix of community and separate property when the value of the community property used to acquire said assets is inconsequential in comparison with the value of the separate property used. IRAs and some retirement plans are considered to be community property, while other qualified retirement plans are governed by ERISA and are treated accordingly based on the participant and the designated beneficiary.
Community property is recognized by Nevada. All property acquired during the marriage is community property except when a pre-/postnuptial agreement states otherwise, when a court issues a contrary ruling, or when the property is considered to be separate property. In Nevada, neither spouse may bequeath more than one-half of the community property in his or her will; neither spouse may give away community property as a gift without consent of the other spouse, and neither spouse may sell any real estate that is community property unless both spouses sign the deed. Separate property in Nevada is considered to be property acquired before the marriage or acquired during the marriage as an inheritance, a gift, or as an award of damages for personal injury. Community property laws apply to domestic partnerships in Nevada.
New Mexico is a community property state. Assets acquired during marriage, including property, vehicles, income, stocks, and IRAs, among other assets. Debt incurred during the marriage is also community property and is of equal responsibility for both spouses. New Mexico law defines separate property as property acquired before marriage; designated as separate property by a valid judgment or decree of any court or written agreement, such as a deed, or gifted to or inherited by a spouse. New Mexico defines separate debt as that incurred before marriage, designated by the court, incurred by one spouse gambling, or incurred by one spouse while living apart and the debt didn’t contribute to the benefit of both spouses or their children.
Community property is recognized in Texas. All possessions acquired by a couple during their marriage is considered to be community property, with exceptions, and is subject to division in accordance with state law. All property is presumed to be community unless it is proven separate. Property that is not considered to be community property in Texas are birth gifts, family heirlooms, inheritances, assets purchased before marriage, and personal injury awards. Dower and curtesy do not exist in Texas.
Washington’s marital property laws recognize the concept of community property. Community property includes all earnings of either spouse during the marriage (including capital gains, retirement benefits, earned interest, etc.), all property obtained with earnings during the marriage, and any property purchased using community funds. In Washington, gifts to one spouse, inheritances, and assets purchased before the marriage are considered to be separate property. Separate property can lose its status if it is combined with community funds. Dower and curtesy are abolished in Washington.
Wisconsin is a community property state. All assets and income acquired during the marriage, including salary, stock dividends, earned interest, retirement benefits, etc., all property acquired during the marriage, and all debts incurred during the marriage are considered to be community property and is subject to a 50/50 split upon divorce. In Wisconsin, separate property is includes anything acquired before the marriage, assets received as a gift or inheritance, or anything acquired after a legal separation. Dower and curtesy rights do not exist.