Is Separate Property Considered Community Property in California?

Question from L, Is Separate Property Considered Community Property in California?

Answer from AI:

In California, the distinction between separate property and community property is crucial, especially in the context of marriage and inheritance. Given the scenario where a man and woman were married for 40 years, and the wife had separate assets such as bank accounts, real estate deeds, and a business in a revocable trust, it is important to understand how these assets are classified under California law, particularly after both spouses have passed away in 2020.

Understanding Separate Property and Community Property

In California, which is a community property state, the law generally distinguishes between two types of property:

• Separate Property: This includes assets acquired by one spouse before the marriage, through inheritance or gift during the marriage, or as a result of personal injury awards. Separate property remains under the ownership of the individual spouse.
• Community Property: This includes assets acquired by either spouse during the marriage, except for those acquired by gift or inheritance. Community property is owned equally by both spouses.

Classification of Assets in the Given Scenario

Given the details provided:

1. Bank Accounts: If the bank accounts were opened and funded with money earned before the marriage or through inheritance or gifts, they would generally be considered separate property. However, if community funds were commingled with these accounts, it could complicate the classification.
2. Real Estate Deeds: Real estate acquired before the marriage or through inheritance or gift would typically be separate property. If the deeds explicitly state that the property is held as separate property, this strengthens the classification.
3. Business in a Revocable Trust: If the business was established before the marriage or funded with separate property, it would generally be considered separate property. Placing the business in a revocable trust does not change its classification but can help in managing and distributing the assets according to the trust’s terms.

Impact of Both Spouses’ Deaths in 2020

When both spouses pass away, the distribution of their property depends on several factors, including:

• Wills and Trusts: If the wife had a will or a revocable trust, the terms of these documents would dictate how her separate property is distributed.
• Intestate Succession: If there were no wills or trusts, California’s intestate succession laws would apply. Separate property would typically go to the deceased’s heirs, which could include children, parents, or other relatives.
• Community Property Distribution: Community property is generally divided equally between the surviving spouse and the deceased spouse’s heirs. In this case, since both spouses are deceased, their community property would be distributed according to their wills or intestate succession laws.

When to Seek Legal Advice

Given the complexities involved in distinguishing between separate and community property, especially with the added layer of trusts and the death of both spouses, it is crucial to seek legal advice. A legal professional can provide personalized guidance based on the specific details of the case and ensure that the property is distributed according to California law.

For more detailed information, you can refer to the [California Probate Code](https://leginfo.legislature.ca.gov/faces/codes_displayexpandedbranch.xhtml?tocCode=PROB&division=6.&title=&part=&chapter=&article=) and the [California Family Code](https://leginfo.legislature.ca.gov/faces/codes_displayexpandedbranch.xhtml?tocCode=FAM&division=4.&title=&part=&chapter=&article=).

Remember, while this information provides a general overview, consulting with a legal professional is essential for addressing specific legal issues and ensuring compliance with all applicable laws.