The Dish on Dividing Assets in a Divorce

Often the most contentious issue when spouses split is the divvying up of “the stuff.” Who’s getting the house, the car, the furniture and all the other hundreds of things that were acquired during the marriage. Here is the dish on dividing assets in New Mexico.
New Mexico is a Community Property State. All property acquired during the marriage is community property; therefore it gets spilt 50-50 unless otherwise agreed upon. Besides the house, car and furniture, other examples of community property are:
• Earnings during marriage (even if payment expected after dissolution);
• Bank accounts;
• Pension & Retirement accounts;
• Life insurance;
• Improvements to separate property made by community property funds;
• Rent/profits from community property;
• Lost wages from an accident.
Separate Property is Not Community Property. Separate property is property you came into the marriage with that stays separate. It can be any property you acquired prior to marriage. Also, it can be an inheritance or a gift.
Separate Property Can Magically Transform Into Community Property. Okay it’s not exactly magic, but you get the point – it can happen. When separate property gets mixed, or commingled, with community property it becomes community property because it can no longer be differentiated. Think about your morning coffee. When you put cream in black coffee it swirls into a luscious mocha concoction that can no longer be separated. So if you get a big check from your Aunt Bertha’s will, do not put it in your joint checking account if you want it to remain separate property, rather than community property.
Debt is Assets’ Twin. Debt is treated the same as assets. It must be classified as separate or community property before this division phase of the divorce process. Any debt accumulated during the marriage is presumed community property, while debt you came into marriage with (e.g., student loans) may remain separate property provided it was not commingled with community property. So if you are making your student loan payments with your joint checking account it could prevent separate debt from staying separate.
Your Division – Your Way. Spouses can work out a distribution agreement that may veer from the rules of community property. Maybe you both feel that one party should keep the house, and the other the boat. Perhaps you agree that it’s most fair for one spouse to take the proceeds from the joint checking account. Regardless of how it adds up, if it suits you and your soon-to-be-ex, the court is likely to go along without any interference.
To consult with a divorce attorney today call the most experienced family law practitioners in New Mexico, the Lightning Legal Group. We are here to help you navigate these significant stages of your life. Schedule a free consultation now by calling 505-247-2390.