Nolo's Essential Guide to Divorce - Emily Doskow [102]
You should be able to hash out issues like this without a lawyer. But if you just can't agree, you may have to get sworn statements from family members or friends about how the gift was intended.
Identifying Community Property
In general, in community property states, partners own equally almost all property either one acquires during marriage, regardless of whose name it is in.
Community Property States
* In Alaska, you have community property only if you and your spouse signed an agreement creating community property rights.
Each spouse's income is also owned half by the other spouse during the marriage. The major exceptions to community property are gifts given to one spouse, property either spouse owned before the marriage and kept separate during the marriage, and inheritances, all of which are the separate property of the person who receives them. "Separate Property," above, lists some other categories of property that don't fall into the community pot.
Issues arise at divorce if you mixed up your community money or assets with separate money or assets or put lots of money or effort during marriage into a property or business that originally belonged to one spouse. Other issues can be confusing, too. A few examples of how to apply the rules are shown in the table on the next page.
In the third example, in the table below, if the husband put the money into a joint account but immediately spent $10,000 of it on a piece of sculpture that he owned in his name only, the sculpture could be considered his separate property. As long as he could trace the funds used to buy the sculpture and prove that they were a separate property gift, a judge would be likely to treat the item purchased with those funds as separate property too.
Getting Financial Information
How do you know you have a complete inventory of assets and debts? You don't, unless you and your spouse share whatever information you have about your joint and separate finances. It's very common for courts to require that you disclose at least the basics of your financial situation to your spouse. If you don't know much about your finances-maybe your spouse always handled those things, while you took care of other matters-the initial disclosure will at least help you know what more to ask for. (For what you'll have to disclose, see Chapter 5.) If your divorce is uncontested, it may be all you need. But if you don't think you've got all the information you need to negotiate, do some more digging. If you're headed for trial, your lawyer will probably make use of formal pretrial "discovery" techniques to get information about financial matters from your spouse. (See Chapter 5.)
What's Community Property?
As part of your negotiation, you may have to hire financial experts to put a monetary value on certain assets. (And you will very likely have to pay for them, unless your lawyer can persuade the judge that your spouse should cover the cost.) For example, retirement plans are an important asset that must be taken into account at divorce. But certain kinds of plans are difficult to value because their value is in the future, when the employee spouse retires. To find out the value of each plan, you'll need to hire an actuary. There's more about that in Chapter 10. You may also want an expert to appraise your family home or other real estate, such as a vacation home.
Is Your Spouse Hiding Assets?
Even with all the procedures in place to help you learn about your spouse's finances, you may suspect that your spouse is not being completely forthcoming with you. Don't ignore your concerns. You can't make the right financial decisions in your divorce without complete information.
Red Flags
People can be very creative when it comes to hiding money. Here are some warning signs to look out