Community Property Division in Arizona
Whether or not your divorce involves minor children, you will have to decide how your assets and debts should be divided upon divorce. Property division can be very complex in Arizona divorce cases, making it essential for you to seek help from a qualified divorce and property division attorney at Colburn Hintze Maletta.
To determine how to equally divide property and assets during a divorce, there are many elements that family law courts or mediators will look at.
In this article, we explain different categories of assets and the different Arizona laws that pertain to each asset.
Community Property vs. Separate Property
Under ARS 25-211, property that either spouse acquires during a marriage is presumed to be the Community Property of the couple. This means that in a divorce, both spouses will have a right to an “equitable” division of the property. In practice, “equitable” usually means equal. In contrast, property owned by either spouse prior to the marriage is generally considered sole and separate property and is not subject to division by the court.
There are certain exceptions to the general rule that property acquired during the marriage is community property, including::
- Property acquired using funds from the sole and separate property of one spouse;
- Property gifted to one spouse but not the other;
- Property inherited by one spouse but not the other;
- Property acquired by either spouse with sole and separate income or funds after the divorce petition is served and filed.
Community property is required to be divided during the divorce process. Under ARS 25-213, however, a spouse with separate property will retain it after the divorce is final, as such property is not considered part of the marital estate.
In most divorces, the court will equally divide the community property between the spouses. Property subject to division by the court includes:
- Real property (i.e. houses and land);
- Bank accounts and cash;
- Vehicles;
- Personal Property (i.e. clothing, appliances, furniture, jewelry, pets, etc…);
- Retirement/Invest Assets (i.e. 401(k)s, pensions, brokerage accounts, stocks, stock options, cryptocurrencies, etc…);
- Business Interests;
- Life Insurance Policies;
- Other assets.
Debts that occurred during a marriage are also considered to be community property in nature and will be divided between the spouses. When a divorce petition is filed, there will be a rebuttable presumption that all of the assets and debts accumulated during the marriage are part of the marital estate subject to an equitable (usually equal) division.
However, if a party can prove that one of the relevant exceptions applies such that the property is deemed one spouse’s sole and separate property, it will generally not be divided by the Court.
Separate Property – What it Means
Under ARS 25-213, separate property is not divided between the spouses and includes the types of assets previously described. However, if you commingle your separate property with the community property during your marriage, the commingled property might lose its separate nature and be considered part of the marital estate.
Property that has been commingled with marital assets to such an extent that it can no longer be traced to its source of origin may be considered community property.
For example, if you brought $50,000 into your marriage, deposited it in a joint account that was later mixed with community funds and used to purchase items for you to use as a couple, the court may end up treating the entire account as community property despite the initial $50,000 sole and separate contribution.
If you bring the separate property into your marriage, you should keep it separate. That means never mixing sole and separate funds with community funds. For example, you could place the $50,000 in a separate account that only has your name on it and never deposit community funds (e.g. income during the marriage) into the account. In that case, you should be able to easily prove to the court that the money in the account is sole and separate.
Choosing A Divorce Attorney in Arizona
In Arizona, family law issues strike close to home for most people. To make the right decisions for your family in a family law case, you will need the help of an experienced and knowledgeable advocate to advise and guide you through the process.
The Arizona family law attorneys at Colburn Hintze Maletta work closely with people who are going through a divorce, child custody and visitation matters, modifications, and more. We also help with establishing paternity, legal decision-making, prenuptial agreements, and same-sex divorce issues.
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