Are you going through a divorce in the state of California? As a community property state, there are several things you need to understand with regard to property division.
There is no denying the fact that divorce will bring many questions to the forefront. While you need to deal with each one at its own time, don’t put matters of property and debt division on the backburner.
Here are some of the most important questions to answer:
1. Have you made a list of all your assets and debts?
This is not the most enjoyable process, but it’s something you should do as you move forward with divorce.
It’s a good idea to have a comprehensive list of both assets and debts, as this can help avoid confusion as things move forward.
2. Who gets the house?
This is one of the most common questions. It’s also a question that doesn’t have a “set” answer.
If you have children, for instance, the parent taking on the daily task of raising them will probably (but not always) keep the home.
On the other hand, there are situations in which one person purchased the home before getting married. In this case, he or she can legally keep the property and ask the other person to vacate.
3. Have you taken your debt into consideration?
It’s easy to get so caught up in the division of assets that you overlook the debt you’ve accumulated during the marriage. This can include many things, such as credit cards, store credit cards and home equity loans.
Just the same as assets, debt must be divided during the divorce process. As noted above, this is why it’s so important to make a list of both your assets and debts.
4. How will your taxes be affected by the divorce and property division?
If you overlook this important question, it could come back to haunt you down the road.
You need to realize that not all property impacts your tax situation in the same manner. For example, when dividing retirement funds and stocks and bonds, this is always a question that comes into play.
When it comes to the division of assets and debts, nothing should be swept under the rug during a divorce.