The basics of commingled assets

The basics of commingled assets

On behalf of Stange Law Firm, PC posted in Property Division on Saturday, November 2, 2019.

As this blog has discussed before, marital property is subject to the property division process when a couple divorces. This means that separate property is not subject to the property division process but there is a third category of property that can come up during divorce and property division that divorcing couples should be familiar with which is commingled property.

It can be helpful to look at the various definitions of property the family law court uses when dividing property. Marital property is divided during divorce according to property division rules. Marital property generally refers to property and assets acquired by the divorcing couple during marriage. Separate property, which is commonly not subject to the property division process, includes property one of the spouses entered the marriage with, inheritances, gifts and personal injury awards.

Commingled property can be a third category of property that comes up that may be subject to the division process. One of the most common examples of commingled assets is when one spouse puts separate property assets into a marital asset. It is important for divorcing spouses to be familiar with this category of property because the separate property spouse may need to trace the funds and the other spouse may want to fight to characterize them as marital property if they have been used to improve a marital property asset.

When commingled assets come up during the divorce and property division process, divorcing spouses should be prepared to handle that concern. Trained guidance through the property division process can help divorcing spouses protect their interests and reach a property division settlement agreement that benefits both of them according to equitable property division principles.

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