Joint Tenancy vs. Community Property in Divorce
Going through a divorce is a daunting task, and property division with your former spouse can be difficult. It’s crucial to understand how property may be shared in your particular situation, especially when it comes to your family home.
Two terms you may encounter as you negotiate the terms of your divorce are '“joint tenancy” and “community property.”These concepts, while similar in some respects, differ significantly in their implications.
Legal ways to share marital property
Property sharing in a marriage can take several forms. Joint tenancy and community property are two prevalent ones. These terms might seem interchangeable, but in the legal world, they carry distinct meanings, rights, and responsibilities.
Joint tenancy
Joint tenancy is a form of joint ownership where two or more people hold an equal interest in the property – they co-own it. Each person has an undivided right to the entire property, and the “right of survivorship” applies. This means, upon the death of one tenant, their share automatically transfers to the surviving co-owners, regardless of any will left behind. Property can be owned as joint tenants without marriage.
Community property
“Community property” refers to the principle where all assets and income acquired during the marriage are considered equally owned by both spouses. This concept is primarily practiced in nine U.S. states, known as community property states.
Unlike joint tenancy, there's no right of survivorship in community property. This means that each spouse can will their half to someone else, if they wish.
Community property applies strictly to married couples and registered domestic partners.
Your state laws regarding property and divorce
In a divorce, the determination of who gets what depends on whether the couple's property is held as joint tenancy or community property.
Joint tenancy vs. community property in divorce
For joint tenants undergoing a divorce, the property is usually sold and the proceeds are divided equally, thereby dissolving the co-ownership. However, if one party can afford to buy out the other's share, they can become the sole owner.
Read: Calculating a House Buyout in Divorce
For divorcing couples in community property states, each spouse retains 50% ownership of all community property. However, the court has the discretion to divide the property in a manner deemed fair and equitable during the divorce proceedings. This may not always mean an equal split.
At Hello Divorce, we know you may be wondering what will happen to your house after divorce. You likely have a lot of other questions, too. Our mission is to make divorce understandable, accessible, and affordable for everyone.
We offer online divorce plans for every budget and every situation. Whether you need legal advice, financial consultation, or help finding a mediator, we have your back. Don’t forget to check out our suggested readings below for more helpful information.
Suggested:
