Since Arizona is considered a community property state, it is imperative to understand what assets are considered community property and which are considered sole property. When you first meet with an attorney, one of the questions they will ask is about what assets need to be divided. In a community property state, unless an asset is clearly owned by one party or another, the assets will be divided equally. The following types of property may be considered solely owned:
- Inheritance of property – when a married spouse inherits property or cash the property is generally considered solely owned. There are exceptions to this rule, for example if the person inherits money and commingles the inheritance in a joint account it could become part the overall assets of the “community.” The same would occur if the spouse inherited real estate and elected to add their spouse as a joint owner.
- Personal injury awards – in the event one spouse has recovered damages from a personal injury claim, the settlement from the claim is considered solely owned. While during the marriage the funds may be commingled or used for the benefit of both spouses, at the time of separation/divorce they revert to sole ownership.
- Property brought to the marriage – both spouses have the right to maintain ownership of any property they owned prior to the marriage. This includes vehicles, jewelry, solely owned bank accounts, etc. Unless there is a written agreement that states clearly the spouses agreed to make the property part of the “community” upon divorce the original owner would maintain control of the property.
Sole ownership applies to debt in some cases
Arizona community property laws do not just apply to assets, they also apply to the debts of the marriage. In some cases, however, debts would not be considered the responsibility of both parties. The cases where community property laws would not be applied to debt include:
- Restitution – if one spouse was sued and is required to pay a judgment that does not apply to the protection of community property or interests, they will be entirely responsible for that debt.
- Student loan debts – in nearly all cases, student loans are the sole responsibility of the spouse who incurred the debt.
- Debts incurred after separation – credit card purchases, cash advances on credit cards and other debts that one spouse incurred after divorce or separation papers were filed will be the responsibility of the spouse who incurred the debt.
When you need the help of an Arizona attorney, Shaffer Family Law can help. We can help ensure that solely owned property or debts are not incorrectly attributed to the community property of the marriage.