Determining Community Property vs. Sole and Separation Property in an Arizona Divorce

The process of getting a divorce involves the division of assets and earnings between the married couple. Property settlements is just one issue that has to be resolved in the divorce process. In Arizona, property is categorized as either separate or community property and it will be divided accordingly. If 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. This category of property is equally owned by both spouses, 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:

Separate Property:

Gifts and inheritance
Awards from personal injury cases
Separately owned property purchased outside of joint funds even if bought during the marriage
Personal business owned prior to the marriage (if the business gains value during the marriage that increase in earnings can be considered community property)
Property such as land or vehicles owned before the marriage
Community Property:

All property accumulated during the marriage
All wages earned throughout the marriage
Any debts incurred in the marriage
Examples include car loans, house mortgages, and unpaid credit cards
Benefits, retirements, or pensions that accrue interest during the marriage
Stock options
Mixture of Community and Separate Property:

A spouse may have separate funds due to selling property owned before the marriage, but may buy new property with a combination of those separate funds and community funds. In order 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 complex 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 for the total assets owned together. After the value is determined, there are several various distribution paths. Some of the common options, include:

Cash out distributions
Deferred division distribution
Reserved jurisdiction distribution
“In kind” distribution
Sale and division distribution