Community Property

California is a community property state.

Community property means any property (including income and debt) acquired by one spouse is considered equally owned by both spouses even if only one spouse’s name is on the official title.  For instance, if husband and wife buy a house and husband pays for 100% of it and only his name is on the title, the property is still considered 50% owned by the wife because it was bought after they got married.  This comes as a huge surprise to my newly married friends who thought they were keeping their money separate by maintaining separate accounts.

A few exceptions to this are what’s called Separate Property.  Separate Property is property acquired by either spouse before marriage or by gift or inheritance during the marriage.  So if husband bought a house before he got married, that is considered Separate Property and wife does not own any of it.  And if husband’s mom decides to gift him a new car, the wife, again, does not own any of it regardless if it was given to him before or after marriage.  And if husband’s mom passes away and he gets an inheritance, the wife does not own any of that either.  The exception to this exception is if you put money you made after marriage into theses accounts.  So if husband bought a house before marriage (Separate Property) but used money he made after marriage to pay the mortgage, it will most likely end up being Community Property.

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