Community Property vs Equitable Distribution Jurisdictions
Community property states (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin) treat property acquired during marriage as jointly owned by both spouses, regardless of who earned it or whose name is on the title. Upon divorce, community property is divided 50/50. Separate property (owned before marriage, inherited, or gifted to one spouse) remains separate. Equitable distribution states (the other 41 states) do not presume equal ownership. Instead, courts divide marital property in a manner deemed equitable (fair, not necessarily equal), considering factors like length of marriage, earning capacity, contribution to the marriage (including homemaking), and each parent's needs. A 50/50 split might be fair in one case and 40/60 in another.
Valuation, Commingling, and Goodwill
Property division requires valuation: a home is appraised, retirement accounts are valued at divorce date, and businesses are assessed using income or asset approaches. Commingling (mixing separate and community/marital property) can convert separate property to marital: if a spouse's premarital savings are deposited into a joint account used to buy a marital home, that contribution may be lost or credited as a separate-property claim. Professional goodwill (the value of a dental practice or law firm) is increasingly treated as marital property and divided. Spousal support (alimony) is separate from property division; some states cap or eliminate alimony for marriages below a threshold length.