“Is Virginia a community property state?”: Any divorce must address the question of property split. Community property or equitable distribution rules are the foundation upon which states split marital property. There is always an even division of community property.
In this article, we will examine closely the community property laws in 2023 to help you determine which rules apply in your state.
What Exactly Is Community Property?
With rare exclusions, under community property laws, regardless of whose name is on an item, both spouses own an equal share of all assets and debts accumulated during the marriage. Each spouse is entitled to one-half of the marital assets and liabilities in the event of a divorce.
According to the idea underlying community property, spouses should share equally in the acquired assets and liabilities as long as they contribute financially to the marriage and keep the family operating. Even a stay-at-home parent contributes to the success of the marriage and should be eligible for an equal share of the assets.
Both partners are equally liable for debts, and they are equally responsible for increasing the marriage’s assets.
What Constitutes Separate Property in Virginia?
Property owned only by one spouse or obtained through gifts is separate property in Virginia. Along with assets received as gifts or inherited during the marriage, this also includes assets purchased or owned before the wedding. Property bought during the marriage with money earned before the marriage is also separate property.
Ownership of a business may or may not be separate property. If the concept of the business provides the majority of its value, it is more likely to be considered independent property. If the business’s worth is generated from the time and effort invested in it after the marriage, money earned is likely to be considered separate property.
Community assets include:
- Earned money during the marriage
- Purchases made by either spouse throughout the marriage
- The value of newly established retirement funds or contributions to existing accounts made during a marriage.
- Bank accounts and investments increased during the marriage.
- Unique property transferred to joint accounts
The separate property becomes marital property, such as when one spouse utilizes personal resources to help purchase a family car in both names.
Is Virginia a community property state?: States with Community Property
There are now nine states that recognize common property.
The states with community property are:
- the state of New Mexico
Is Virginia a community property state?: Separate vs. shared property
Spouses should understand the distinction between marital and non-marital (separate) property. Marital (community) property refers to assets and obligations acquired during the marriage.
Separate Property Acquisition Prior to Marriage
The majority of a spouse’s assets or responsibilities prior to marriage are considered separate or non-marital property. If one spouse held it prior to marriage, it normally remains a distinct asset or obligation.
Assume a wedding takes place on June 6, 2021. Spouse A graduated in July 2018 with $26,000 in student loan debt prior to the marriage. This is non-marital property (debt) because Spouse B was not present when Spouse A secured the student loans. If the couple divorced, Spouse A would still be responsible for repaying the loans; Spouse B would not.
Is Virginia a community property state?: Assets Acquired Separately While Married
Non-marital property includes assets acquired by one spouse during the marriage as a gift, inheritance, or personal injury settlement.
Special Considerations in States with Community Property
If a married couple pays their taxes separately, determining what is and isn’t joint property might be difficult. State laws may ascertain who owns investment income, Social Security payments, or even mortgage interest complexes.
Tax professionals advise computing the tax both jointly and separately. Many people believe that the difference is so minor that it is hardly worth the hassle of filing separately, barring exceptional circumstances.
Is Virginia a state that recognizes community property?
Virginia is NOT a community property state. Virginia judges divide property according to the equitable distribution policy. The court divides assets between the spouses in what is thought to be a fair distribution.
In reality, courts in states with equitable distribution laws, like Virginia, frequently split the marital estate so that around two-thirds of the assets go to the spouse with the higher income and one-third go to the spouse with the lesser income.
Is it legal in Virginia to share marital assets exclusively after a divorce?
Only assets or property termed “marital property” or “community property” are subject to partition in a divorce proceeding in Virginia.
Due to contributions from the other spouse or asset co-mingling, certain individual property may be regarded as “partial community property” or even entirely ruled to be community property, resulting in complex property division conditions.
Does Virginia consider a spouse’s financial wrongdoing when distributing property?
According to Virginia law, the equitable distribution of property may take into account a spouse’s economic malfeasance. Dissipation of assets is the legal term describing a spouse’s waste or loss of marital income or assets by techniques such as lavish spending, gambling, fraud, and so on.
If one spouse mismanaged marital assets in a way that hurt the other spouse, the court may take punitive or restorative action by distributing a larger piece of the divided property to the aggrieved spouse.
Does Virginia consider Prenuptial Agreements?
However, a prenuptial agreement, sometimes known as a prenup, is a legally binding instrument that both parties must sign before marrying in Virginia.
If a prenuptial agreement is in existence and legally enforceable, the Virginia court may not have the jurisdiction to divide the couple’s assets in any way other than how both parties agreed before the event.