Dividing the Property & Debts
When couples look to divide property the state they reside in can make a difference. Utah, along with most states divide the property equitably. This usually means both parties are entitled to half the equity in any real property acquired during the marriage. Divorce attorneys, and courts, start at 50/50 and then deviate from there.
Nevada, along with about eleven other states are community property states. This means the divorce attorneys, and courts, will decide what is community property and divide it equally.
What is Community Property?
Community property is a label defining any property acquired during the marriage. A home purchased, a vehicle leased, and bank accounts opened are prime examples of community property.
The name on the title, or whose name is on the property doesn’t define community property. To be community property you don’t need your name on the title. If the property was acquired during the marriage the court will presume it is community property. This goes for homes, vehicles, bank accounts, and retirement accounts.
Some property acquired after the marriage can be considered separate property. We call these exceptions to the presumption of community property. Inheritance and gifts are the most common exceptions. Property, money, or heirlooms gifted to you would be separate property.
What is Separate Property?
Separate property is property owned before the marriage, or property acquired during the marriage that falls within the exceptions. Separate property remains yours after a divorce and is not divided equally. An example might be $10,000 in bank account that you had before the marriage. A car you purchased before the marriage. Or, a home your parents willed to you. These are separate property and are not divided.
Wages are Community Property?
Wage or income earned during marriage is community property. This concept might be one of the hardest for divorcing couples to understand. Wages, or income earned and deposited in a bank account, savings account, or IRA’s are community property and divided equally in a divorce.
Are Debts Community Property?
Debt works the same way as any asset. Any debts incurred during the marriage are community debts and need to be divided evenly. Credit cards, car loans, home loan, etc. The confusing part of debts is when the debt secured against property.
Homes and vehicles are the best examples. Let’s say you purchased a car during the marriage. You drive it, and there is a loan on the car. The car is a community asset which needs to be divided equally. The loan is a community debt which needs to be divided evenly. Instead of dividing the car and the loan, the court will look to pair the debt with whomever keeps the asset. Credit cards are unsecured debts and don’t typically pair with an asset.
Student loans are an interesting issue. The Nevada courts look at student loan debts as separate debts secured by the education the person received. The public policy is the spouse who earned the education has an asset and should keep the debt associated with the education.
About the Author. This guest article was written by the attorneys at Right Lawyers. Right Lawyers is one of Nevada’s leading divorce law firms. For the last 15 years, Right Lawyers, and their four attorneys, have helped guide clients through a divorce, and through the process of dividing community property, and protecting separate property. For more information about Right Lawyers or filing a Nevada divorce you can contact Right Lawyers at (702) 914-0400.