Because California is a community property state, it can be difficult to decipher how to divide and distribute property. Separate property, in particular, becomes complicated to track because couples may share assets during their marriage. Spouses who have separate property in shared accounts have commingling assets. When this happens, one would need to trace their funds back to see who owns it.
Tracing occurs when a court or couple needs to determine separate property during the divorce. Separate property can take the form of:
- Inheritance or gifts
- Family heirlooms
- Personal property used solely for business
- Property acquired before the marriage
- Property declared separate under agreement
Let’s say that one spouse inherits a large sum of money from their relative. They put that money in their joint account. In order to claim that money as separate property, the individual would need to trace back when money was withdrawn and deposited. It is important to note that while the inheritance is classified as separate property, the state considers any interest earned on that as community property.
Steps to trace separate property through joint accounts include:
- Find all your bank statements. This is key evidence you will need to show the courts.
- Determine the source of each deposit and the reason behind each withdrawal.
- Categorize items and funds into marital property and separate property.
- Check for any interest earned on separate property, as it may be considered communal.
- With the help of your divorce lawyer, organize your information to present to the court.
Not carefully monitoring your separate property can have serious financial implications during your divorce. To ensure you protect your funds and assets, contact our San Bernardino property division Attorney. We will help you trace your funds and assets to determine what solely belongs to you. Our attorney specializes in family law and can help you understand the complicated laws concerning property division. Call today to schedule a free consultation.
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