Understanding what is community property is key to helping a married client with their planning goals and objectives. Although community property predominantly exists in 11 states, many clients move in and out of these states and bring their community property with them. Many of the non-community property states (or common law states) have laws that address community property brought to their state. This course will explain: (1) how assets obtain their classification as community or separate property, (2) what presumptions and rules are applied in classifying an asset as community property or separate property, (3) the significance of methods of holding title in determining whether an asset is community or separate property, (4) how agreements between spouses impact these classifications (5) the consequences of moving to or from a community property state and (6) the impact of community property on income taxes and transfer taxes.
Identify what is community vs separate property and why is it important to know these terms.
Recognize how the character of property is different but sometimes the same as the title of the property.
Recognize that the analysis for what is community property vs separate and its’ impact can be similar but not necessarily the same in different states and in the case of death, divorce and tax reporting. The type of asset or income can also impact this analysis.
Identify that the time that property is acquired, the source of funds or credit and titling often determine whether property is community or separate property - all of which can usually be overridden by agreement.