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Marriage & Property Ownership: Who Owns What?
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These rules apply no matter whose name is on the title document to a particular piece of property. For example, a married woman in a community property state may own a car in only her name -- but legally, her husband may own a half-interest. Here are some other examples:
| Property |
Classification |
Why |
| A computer your spouse inherited during marriage |
Your spouse's separate property |
Property inherited by one spouse alone is separate property |
| A car you owned before marriage |
Your separate property |
Property owned by one spouse before marriage is separate property |
| A boat, owned and registered in your name, which you bought during your marriage with your income |
Community property |
It was bought with community property income (income earned during the marriage) |
| A family home, which the deed states that you and your wife own as "husband and wife" and which was bought with your earnings |
Community property |
It was bought with community property income (income earned during the marriage) and is owned as "husband and wife" |
| A camera you received as a gift |
Your separate property |
Gifts made to one spouse are that spouse's separate property |
| A checking account owned by you and your spouse, into which you put a $5,000 inheritance 20 years ago |
Community property |
The $5,000 (which was your separate property) has become so mixed with community property funds that it has become community property |
Changing the rules with a written agreement. Married couples don't have to accept the rules about what is community property and what isn't. They can sign a written agreement that makes some or all community property the separate property of one spouse, or vice versa.
Some community property can avoid probate. Several community property states offer an advantageous way of holding title to community property that avoids probate at the death of the first spouse. It's called "community property with right of survivorship." If a couple holds title to property -- a house, for example -- in this way, when one spouse dies the property will automatically belong to the survivor, without any probate court proceedings.
If you are ready to take charge of your estate planning, get Busy Family's Guide to Estate Planning: 10 Steps to Peace of Mind, by attorney Eliza Weiman Hanks (Nolo). It provides the information you need to plan for the future, including how to draft a simple will.
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