Community Property Definition and Legal Meaning

On this page, you'll find the legal definition and meaning of Community Property, written in plain English, along with examples of how it is used.

What is Community Property?

It is asystem of dividing property owned by husband and wife equally on divorce or on the death of one of them.This includes property that that has been acquired during their marriage without considering who paid for the property or in whose name it is owned.All property is joint property except the one that is inherited or any special gifts or anykind of property owned before marriage.It is done with the intention of being fair with the married couple regardless of who is earning more.Property that is owned separately by them can be converted into community property by agreement.

History and Meaning of Community Property

Community property is a legal concept that originated in civil law systems and is now widely recognized in the United States. It was created as a way to ensure that both spouses in a marriage have an equal claim to property, regardless of who earns more or who holds title to the assets. This system has its roots in Roman law, which deemed marriage to be a partnership in which both spouses shared equally in the property acquired during the marriage.

Community property has since been adopted in many U.S. states, including Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. In these states, unless there is a prenuptial agreement in place, most property acquired during the marriage is considered community property and is owned equally by both spouses.

Examples of Community Property

  1. In Arizona, a house purchased by one spouse during the marriage using funds from a joint checking account would generally be considered community property and be split equally in a divorce settlement.
  2. In California, if one spouse runs up significant credit card debt during the marriage, that debt would typically be considered community property and both spouses would be responsible for paying it off.
  3. In New Mexico, a business started by one spouse during the marriage would generally be considered community property unless the other spouse can prove they did not contribute in any way.

Legal Terms Similar to Community Property

  1. Equitable distribution: This is the system used in many U.S. states where a judge decides how to divide marital property based on factors like the length of the marriage, each spouse's earning potential, and contributions to the marriage.
  2. Separate property: This is property that is owned solely by one spouse and is not subject to division in divorce proceedings.
  3. Marital property: This is any property acquired during the marriage, whether it's owned jointly or separately by each spouse, and is subject to division in divorce proceedings.