Determining Community Property Versus Sole and Separate Property in an Arizona Divorce
The process of getting a divorce involves the division of assets and earnings between the married couple. Property settlements are just one issue that has to be resolved in the divorce process. In Arizona, the property is categorized as either separate or community property and it will be divided accordingly.
If the property is deemed as separate, the owner will keep that property after the marriage, and it will not be split. Dividing community property, however, is when property settlements can become time-consuming and complicated. Both spouses equally own this category of assets, so in a divorce, it has to be divided as such.
Determining Community v Sole and Separation Property in AZ | Add It All Up
The property owned by a couple is broken down into categories using these guidelines:
- Gifts and inheritance
- Portions of Awards from personal injury cases
- Separately owned property purchased outside of joint funds even if bought during the marriage
- A personal business owned before the marriage (if the business gains value during the marriage the increases in earnings can be considered community property)
- Property such as land or vehicles owned before marriage
- All property accumulated during the marriage
- All wages earned throughout the marriage
- Any debts incurred in the marriage
- Benefits, retirement plans, or pensions that accrue interest during the marriage
- Stock options
A mixture of Community and Separate Property
A spouse may have separate funds due to selling property owned before the marriage but may buy a new property with a combination of those separate funds and community resources. To be partly separate property, proof must be shown that separate funds were used when buying the property.
The division of community property can prove to be complicated and overwhelming. In Arizona, there are many options that the court can take when it comes to property settlements. The first step is coming up with a net value of the total assets owned together. After the value is determined, there are several various distribution paths. Some of the standard options include:
- Cash out distributions
- Deferred division distribution
- Reserved jurisdiction distribution
- “In-kind” distribution
- Sale and division distribution
Chris Hildebrand wrote this article about community property and separate property in Arizona to ensure everyone has access to information about community property laws in Arizona. Chris is a family law attorney at Hildebrand Law, PC. He has over 24 years of Arizona family law experience and has received multiple awards, including US News and World Report “Top Arizona Divorce Attorneys”, Phoenix Magazine “Top Divorce Law Firms”, and Arizona Foothills Magazine “Best of the Valley” award. He believes the policies and procedures he uses to get his clients through a divorce should all be guided by the principles of honesty, integrity, and actually caring about what his clients are going through.