Classifying Property by California Law and Why

There are three types of property classifications in California law: community property, separate property, and quasi-community property. It is important to know the differences between them, because the definition of a property determines who has ownership and control of the property. The definition will also determine how the property is distributed to the spouses in the event of divorce.

California law describes community property as any asset acquired or income earned by a married person during the marriage. An asset can be a future (or current) pension plan, real estate, personal property, intellectual property (such as royalties from a book written during the marriage), salary, sick leave hours, and earned vacation time from employment or even businesses created during the marriage.

Community property does not include gifts received during the marriage, inheritances, property acquired before the marriage, or property acquired after the marriage ended.

Separate property, as defined by California law, is property acquired before the marriage or after the parties to a marriage separate. Again, it can be the same type of property as community property, but not acquired during the marriage. It also includes gifts and inheritances.

The third classification of property in California known is "quasi-community property." This type of property usually consists of property acquired or owned in another state or country, but acquired during the marriage. California law treats quasi-community property the same as it treats community property.

In the event of divorce, determining the type of property can be difficult. Has separate property been used to purchase community property or vice versa? What about businesses owned before the marriage but where community assets have been provided to them? Do employee pension plans that were separate property of the employee before marriage suddenly become community property after the marriage because the employee continues to contribute a portion of his/her salary to the plan?

There are many issues that arise in classifying property and property rights in California. Those issues are often very complex. They are best handled by a qualified family law attorney to ensure that a spouse receives his or her fair interest in that property.