Understanding Commingled Property in Divorce

When two spouses get divorced they have to divide the property they own. There are two types of property that spouses can own: community property and separate property. Community property is any property that is not separate property.

What is Commingling?

Commingling refers to situations in which spouses combine separate and community assets. For example, consider a situation in which a husband contributes $45,000 of his income to an account containing $45,000 of savings his wife amassed before marriage. During this period, the account also accumulates $10,000 worth of interest. In this instance, 45% of this $100,000 account would likely be considered the wife’s separate property, while the remaining 55% would be a community asset.

Property Has Been Commingled. Now What?

When faced with commingled accounts, spouses who wish to retain separate assets must “trace” or prove the origin of these assets. Tracing is generally conducted by a forensic CPA. However, their testimony alone may not be sufficient to win a claim. Tracing is a complex process that often requires substantial time and resources. It is vital to hire a reputable forensic CPA who is both familiar with your attorney and skilled at presenting testimony during litigation. Experienced family lawyers will have strong relationships with qualified experts in your area.

If you think that you’ve mixed your property with your spouse, be prepared to “retrace your steps” and be ready to gather documentation that may go back years. Contact our team today if you’re ready to discuss your case.