How Do I Prove My Separate Contribution To A Community Asset And Get My Money Back In A Divorce?
Property division in California divorce or legal separation can be complicated—especially when one spouse invested their separate money into a community asset.
In California, community property is all property acquired by a married person from the date of marriage until the date of separation. Community $$ can include earnings by either spouse during marriage, savings in the bank accounts, retirement contributions, stocks, real property, vehicles, furniture and furnishings, jewelry and art, portion of the business, etc. Separate property under California law is all property acquired by a spouse before marriage, or that was acquired by gift or inheritance.
During a divorce or legal separation, all assets and debts of the parties will generally be characterized as separate or community property. California Family Code Section 2104 mandates that both parties exchange preliminary declarations of financial disclosures detailing and characterizing all assets and debts, income and expenses.
Sometimes an asset can be a combination of community and separate property. For example, if a married couple purchased a home but one spouse paid $10,000 towards the downpayment from their separate funds, they will be entitled to a Family Code 2640 reimbursement of their separate downpayment. Separate $$ can come from various sources such as $$ earned before marriage, $$ received as a gift or inheritance from parents or relatives, or resulting from a sale of any property owned by that spouse prior to marriage.
In California, the court presumes all property acquired during the marriage belongs to the community. To prove a separate property reimbursement claim, a spouse making the claim must provide documented evidence showing the nature and origin of the funds they claim are their separate contribution. Proving the claim can be as simple as providing bank statements showing the existence of the funds in a separate account prior to the date of marriage and a subsequent transfer towards a downpayment on the asset.
But what happens if it’s hard to distinguish funds/assets as separate or community property? Often separate funds of one spouse is mixed into community funds. When separate and community funds have been mixed, they are called “co-mingled.” A spouse in California will have to use one of two methods to “trace” their separate contribution to commingled funds. The direct tracing method requires specific and chronological records of each separate and community property deposit or withdrawal from the commingled account. Another, more complicated method is the Family expense (recapitulation) method. This method requires a tracing expert because the court assumes community funds are used to cover family expenses, such as food and household expenses. If the community funds are exhausted, the court may agree that the remaining funds are separate property. Similar to the direct tracing method, it is not enough to show that separate funds existed at the time payments were made. Records must evidence that community funds were first depleted at the time a particular purchase was made.
It is important to know your rights and what you are entitled to in a divorce. Our skilled family law attorneys at Livingstone Law, APC have the experience and knowledge to help you keep your separate property in a divorce. Livingstone Law APC. has the experience and knowledge necessary to provide you quality legal representation at an appropriate and fair price. Call or email Livingstone Law, APC today and see how we can help you. Check out our reviews for on Avvo.com or view our website at www.livingstonelawsd.com.
*The information provided above is for informational purposes only. It is not legal advice and should not be interpreted as legal advice.
