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Division of Assets and Debts

California is a community property state and while the general rule is that assets and debts acquired during marriage are divided equally upon dissolution or legal separation, in practice what constitutes equal division and what is characterized as community property is not nearly so straight forward.  Division of assets and debts in California becomes even more complicated when, for example, one or both spouses operate a business, or if one spouse used community funds to improve a separate property asset or pay off a separate property debt, or if community and separate property funds have been comingled (think contributing to your 401(k) after the date of separation), or if there are student loans and higher education expenses that were paid for during the marriage, or if there is an existing prenuptial or postnuptial agreement in place. 

Sometimes it can be very difficult to ascertain what assets are community property and which are separate property.  Sometimes clients have to deal with some real surprises regarding division of assets they were never educated about; for instance, learning that the community may be obtaining an interest in a home one spouse purchased prior to marriage because there was a mortgage on it that was paid on during the marriage, or worse refinanced during the marriage.  Teachers, who often do not receive social security retirement, may be surprised to learn that they must share their CalSTRS pension with their spouse, leaving them with only half of retirement plan and no government safety net.  In another example, business owners may be surprised to find out that their pre-marital "separate property business" is now mostly community because most of the growth and prosperity of the business occurred during the marriage.

You may also be wondering who will keep the house, or whether you can even afford to keep the house.  Or you may be wondering how to you ensure the credit cards and other obligations are paid during the process.  We can help you answer your questions and assist you in creating a plan to help navigate the future and make it a little less uncertain.

At Murphy Family Law, we educate our clients to plan for likely outcomes and to help them strategize and plan for the best possible out comes.  We also have significant experience dealing with high net worth and asset dissolution matters, and division of complex business interests.  To assist in that endeavor, we are also extremely well versed in interstate and international discovery issues so should you need to obtain evidence related to financial issues that may be out of the state, we can help you find the answers.  There is a lot of "conventional" wisdom out there on the topic of asset and debt division that is not so conventional, and often not so wise.  We encourage you to schedule a consultation toady to discuss your options and possible issues you may need to prepare to address in your dissolution today.

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