Understanding How States View Marital and Separate Property

Each state defines marital property differently. In Community Property states, nearly everything acquired during the marriage including income, assets, and debts is considered jointly owned and typically divided equally in divorce, regardless of who earned it or whose name is on it. There are currently nine states that follow this approach: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. 

In Equitable Distribution states, which divide marital property fairly but not necessarily equally. Courts will split all assets, earnings, and debts between spouses in a division that is equitable to the judge. Some factors that a court may consider include the duration of the marriage, the value of the marital property, each spouse’s contribution, the spouses’ respective sources of income or earning capacity and the economic circumstances of each spouse upon division of property. All other 41 states follow this method. 

Note that if you have a prenuptial or postnuptial agreement, these are private contracts signed by both spouses (and typically reviewed by lawyers) and thus typically the court will honor your agreed-upon classifications instead of applying the standard community or equitable-distribution rules.

Knowing your state law is important because it shapes what property each spouse keeps after divorce.

See our article: Understanding Marital vs Separate Property 

See our article: Protecting Your Property Rights

See our Article: Common Myths About Marital and Separate Property