Spousal Gifts and Community Property

Spousal Gifts Community Property

Spousal Gifts and Community Property/Photo by Giftpundits.com from Pexels

When is a gift from your beloved not really a gift?

In divorce, of course!

California Community Property Law

Generally, under California Community Property law found in California Family Code � 760. Defined_, everything acquired after the date of marriage, before the date of separation (that is not inheritance or gift from third party) is community property.

I personally don’t like community property and think it’s unfair.

But who cares what I really think? On with the law.

Exceptions to Community Property

Of course there are exceptions, such as inheritance, and gifts from third parties.  These are always the separate property of the recipient, before, during or after the marriage.

Although, as the recipient, you want to make sure you don’t comingle it or transmutate it. 

What About Gifts from My Spouse?

So let’s go back to this Range Rover you got for Christmas from your wife.  Let’s say you divorce.  Do you get to keep this?

Well, there is law for that. California Family Code � 852. Writing by express declaration by spouse whose interest adversely affected; recordation of notice of transmutation_ states that yes, you can keep it if it’s of a personal nature, and NOT substantial in value taking in account circumstances of the marriage.

Basically, if your wife makes $60,000 a year, the $100,000 car would NOT be a gift.  It would be community property.  But, if she makes $6 million a year, then there is room to argue it’s a gift of personal nature and yours to keep.

As always, the best way to relieve any doubt is to get it in writing.  If you really want to keep the Range Rover, make sure you get a valid Postnuptial agreement, or some other valid transmutation instrument confirming it’s a separate gift to you.

Merry Christmas!

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