Dividing assets and debts in a divorce can be one of the most complex and contentious aspects of the separation process. California is a community property state, which means that all assets and liabilities acquired during the marriage are presumed to be shared equally. At SD Law Center, our San Diego family law attorneys guide clients through this challenging process with strategic planning, full financial analysis, and unwavering advocacy.
Under California Family Code § 760, all property acquired by a married couple during the marriage is presumed to be community property—regardless of who earned it or whose name is on the title.
Community property includes:
Debts incurred during the marriage—such as credit cards, loans, and tax obligations—are also presumed to be community obligations.
Separate property is not divided in divorce. Under Family Code § 770, it includes:
A spouse who claims a particular asset is separate property must prove it with clear and convincing evidence. This can involve tracing funds or producing documents that establish the asset’s separate character.
Property acquired in another state by either spouse during the marriage, which would have been community property had it been acquired in California, is treated as quasi-community property under Family Code § 125.
The date of separation plays a critical role in determining whether property and debts are community or separate. California law defines separation as when:
Even if parties live in the same home, actions and communications may establish separation. Financial activity after separation (new income, purchases, or debt) is considered separate property or liability.
Once property is characterized as community, it must be fairly divided. This involves:
Methods of division include:
Our attorneys use appraisers, forensic accountants, and business valuation experts to ensure accurate valuation and full disclosure.
1. Real Estate If the family residence or other properties were acquired before marriage or with separate funds, a Moore/Marsden calculation may apply to determine the community’s interest in the property.
2. Retirement Accounts Retirement plans, pensions, and IRAs require special handling. A Qualified Domestic Relations Order (QDRO) is often needed to divide retirement assets without triggering taxes or penalties.
3. Business Ownership Dividing a business involves determining:
4. Reimbursement Claims Spouses may be entitled to reimbursements under:
Debts incurred during the marriage are generally community debts—even if only one spouse incurred them. After separation, new debts are typically separate.
Student loans, however, are sometimes treated differently depending on whether the education benefited the marriage.
California law requires full financial disclosure. Failure to disclose assets can lead to severe consequences, including:
Our attorneys aggressively investigate and litigate hidden asset cases using subpoenas, depositions, and forensic tracing.
If parties cannot reach agreement, the court will divide community property equally under Family Code § 2550. The judge may assign assets and debts to each party in a way that results in an equal net value.
Courts may consider:
Whenever possible, we help clients reach out-of-court settlements that preserve wealth and minimize conflict. However, we are fully prepared to litigate aggressively when fairness is at stake.
Can I keep the house if I bought it before marriage? Maybe. You may retain your separate interest, but the community may have a claim to appreciation.
What if my spouse is hiding money? We can subpoena records and request forensic analysis. If proven, the court can award 100% of the hidden asset to you.
What happens to credit card debt? If incurred during marriage, it’s generally community debt—even if in one spouse’s name.
Do we split everything 50/50? Not necessarily per item, but the total net value is usually split equally.
The decisions you make during divorce can impact your financial future for years to come. Let our San Diego property division attorneys at SD Law Center help you protect what matters most.
