Wisconsin is just one of a handful of states that use community property laws to determine how assets are divided during divorce. Here are 3 Ways Wisconsin community property laws impact divorce.
Community property systems are designed to distribute the marriage estate equally between both spouses so that each person leaves the marriage with roughly the same amount of assets and debts.
While equality is the goal, the court does take some a number of things into account to determine if it’s appropriate to grant one spouse a larger share of the property based on the needs they’ll encounter after the divorce.
Community property versus separate property
In Wisconsin, any property acquired or income earned by either spouse during their marriage is community property. These assets don’t belong to either person; they belong to the marriage itself.
In addition, any property used to benefit the marriage can be deemed community property; even if it was acquired by one spouse before the marriage began.
Separate property is any income and/or assets, which belonged to only one person before the marriage and were kept in separate ownership throughout the entire marriage. This includes gifts and inheritances.
What is “property,” exactly?
“Property,” is defined as any actual property such as a home or vehicle as well as the intangibles like benefits, dividends and income.
Now that we have a basic understanding of what community property is in Wisconsin, let’s go over three ways it can impact a divorce.
1. If you have separate property you want to keep for yourself, you’ll have to prove to the court it’s yours alone
Wisconsin courts treat all property as community property unless a spouse can prove otherwise. More often than not, this means providing evidence of when you bought that property and demonstrating that during the marriage, it wasn’t used communally.
Moving forward, all property that isn’t deemed separate will be treated as community property and subject to division by the court.
2. All debts are divided equally no matter who incurred them
In Wisconsin, the court automatically assumes all debts arise from the marriage. That means both parties are equally responsible for it after a divorce.
If, for instance, your spouse has run up a large amount of debt in their name during the marriage, you’ll most likely be responsible for half of it regardless.
3. Higher individual income does not mean higher contribution
Since the law presumes that spouses own all assets equally, they view all assets as a whole. This means even if your spouse did not earn income, they’re still entitled to half of the total assets you acquired during the marriage.
What do the courts consider when distributing property between spouses?
So, it’s clear Wisconsin courts try their best to distribute property equally, but it’s important to remember several key factors they consider first, including:
- How long the marriage was,
- The property each spouse brought into the marriage from single life,
- Substantial separate assets owned by either spouse such as a large inheritance,
- You and your spouse’s age and health, and
- Earning capacities
Click here for a complete list of factors considered when dividing property.
If, for example, a spouse has considerably lower earning capacity because he or she decided to support the other spouse’s education or career, a court may decide to award her a larger share in property.
These are just some of the basics of property division laws in Wisconsin. If you have specific questions about how Wisconsin’s community property laws may affect your divorce, click here for a free consultation with the Fitzgerald law Firm.
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Photo credit: Carrie Shield
