The Transfer of Property in a Divorce

by Andrine Redsteer ; Updated July 27, 2017

The transfer of property during divorce depends upon whether a couple lives in a community property state or an equitable distribution state. Many community property states will divide marital assets evenly. However, this is not always the case. Even in a community property jurisdiction a court may find a 60/40 split fair and just. California is the one community property jurisdiction that divides all community property 50/50 between spouses. The means of transferring property upon a divorce settlement varies, depending upon the jurisdiction and type of property involved.

Community Property or Equitable Distribution Jurisdiction

There are eleven community property jurisdictions in the United States: Alaska, Idaho, Puerto Rico, Wisconsin, Texas, Washington, Arizona, California, New Mexico, Nevada and Louisiana. These eleven jurisdictions consider all property acquired during marriage as belonging to both spouses equally. In community property states, separate property — property owned by one spouse before marriage, inheritances or gifts from one spouse to another — is not divided equally upon dissolution. In equitable distribution jurisdictions, courts consider many factors when dividing property upon divorce. One spouse may be entitled to a larger share if a court finds unequal contribution or if the unequal division of marital assets is just and proper.

The Marital Home

Often, the marital home is a couple's largest asset. Where a married couple has children and one spouse is considered the primary caregiver, a court may grant the marital residence to that spouse. A common way in which a marital residence is transferred is by quitclaim deed. One spouse may issue a quitclaim deed to the other spouse, thereby transferring her ownership rights in the property. If there is a large amount of equity in the marital home, a couple may elect to sell it and split the proceeds. The division of proceeds, however, may be ordered in an unequal split, depending on the jurisdiction.

Retirement Funds

In community property jurisdictions, all retirement funds acquired through income earned during marriage belongs to both spouses equally. Typically, courts allow couples to decide how to transfer retirement funds. One way is to cash out the retirement fund upon divorce. Couples can also elect to have the retirement fund valued at the time of divorce and make it half transferable to the non-owner spouse upon the owner-spouse's retirement.

Other Considerations

Married couples may own additional assets that must be divided during a divorce settlement. Other types of assets may include a business owned and operated during the course of marriage, vacation property and bank accounts. Shares of these types of marital assets are divided either equally or in a manner a court deems just. Often, bank accounts are easily divided. However, where a couple owns a business and one spouse is more involved in the day-to-day operation of the business, a forensic accountant may need to examine the business's records to determine its value.

About the Author

Andrine Redsteer's writing on tribal gaming has been published in "The Guardian" and she continues to write about reservation economic development. Redsteer holds a Bachelor of Arts in history from the University of Washington, a Master of Arts in Native American studies from Montana State University and a Juris Doctor from Seattle University School of Law.