To sell or not to sell the marital residence

Did you know there are only 9 Community Property states? Community property states include: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. In these states, any assets acquired by spouses throughout their marriage is labeled as community property, regardless of who buys it. California, Nevada and Washington also include domestic partnerships under community property law. However, there are certain situations where a couple may be exempt from a community property law. Community property laws don’t apply to the following situations:

  • The property was given to one spouse as a gift.

  • One spouse inherited property during the marriage.

  • One person received property through a will or trust.

  • The property was acquired before the marriage began.




  • The property was acquired while the spouses were legally separated and living separately.

  • A VALID prenuptial or pre-marital agreement

  • The property was purchased during the marriage using separate property funds (i.e. inherited money). You must be able to prove this and to be able to trace the funds to that separate property source.

In a long-term marriage; a marriage of more than 10 years, if you’re going through a divorce and live in a community state, most of your assets will be considered marital property. In the simplest of terms, division of community assets is 50/50. Parties to a divorce or termination of a domestic partnership, however, are free to negotiate a different type of division of their assets and debts and to memorialize that agreement into a marital settlement agreement and/or stipulated judgment.


When deciding about what to do with the house during a divorce, to be the one to get the house, to sell, or not to sell, keep in mind that the decision should not focus solely on value. You should also consider liquidity, cash flow and the cost of maintaining the asset once you own it. That can be a significant financial burden.

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