As someone who is
divorcing, you’re probably aware that your marital property is subject to
division in the divorce, but what about debts accumulated by you and your spouse? Do you know
how those are divided? Does the spouse who incurred the debt pay it, or
is the debt split down the middle?
California is one of nine states that is a community property state. This
means that spouses are equally entitled to marital assets regardless of
who earned them, whose name is on them, or who holds the tile. But it
also means that the spouses are equally liable for each other’s
debt, regardless of who incurred it.
Community Debts Explained
Community property under California law is everything a married couple
owns together. This includes everything a married couple earned or bought
while they were married that was not a gift or inheritance – it
also includes debt.
One way to tell if something is community property is to look at the source
of the funds that were used to purchase it. If the item was purchased
with money that either spouse earned during the marriage, then it’s
Community debt is counted as community property. In other words, all debt and financial
obligations acquired or accumulated during the marriage are community
property. So, even if your spouse took out a credit card in their name
alone and charged $10,000 on the card, you would by law, be responsible
for one-half of that $10,000 debt.
“Community property and community debts are usually divided equally,”
according to the
Can We Agree on Something Different?
Divorcing couples in California do not have to stick to the 50/50 model.
If you and your spouse reach an agreement that does not divide the community
debt down the middle, that’s fine, but the judge will have to sign
off on the agreement. When an agreement is reasonable given a couple’s
circumstances, it’s common for the judge to approve it.
Divorce When You’re the ‘Out Spouse’
If you’re looking for a divorce attorney,
contact Claery & Hammond, LLP today.