Funds as Separate Property Later Considered Community Property

The application of community property laws in an Arizona divorce case isn’t always as straight forward as one might think. Funds that start as separate property of one spouse can become “commingled” or mixed in with community property over the course of a marriage. Commingling often occurs when:

  • The separate property of one spouse is combined into a joint checking or savings account belonging to both spouses.
  • Money is transferred from a separate account belonging to only one of the spouses into an account that belongs to both spouses.
  • Funds are reinvested or borrowed from an outside 3rd party during the couple’s marriage.

Keep in mind, however, that just because an asset becomes mixed or commingled does not mean that the asset will automatically be considered as community property under the law. This is because a spouse can still claim an asset as separate if they can trace the asset back to the initial separate property source. In order to do this, a spouse must provide the court with adequate documentation of separate property. Furthermore, since it can be difficult to accurately trace an asset back to its original state, it is recommended that parties to a divorce contact an attorney for assistance.

If the designation between community property and separate property has become an issue in your Arizona divorce case, the Mesa family law firm of JacksonWhite can help. Our Mesa, AZ divorce attorney Tim Durkin can assess your case during a consultation and help you understand your rights. Call 480-464-1111 to schedule your AZ divorce consultation with Tim today!

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