When dividing real estate, retirement accounts, businesses, and debt in a divorce, state law controls how property is categorized and divided between spouses.
Community Property States (9 States)
In states like California, Texas, and Washington, all assets and debts acquired during the marriage are considered community property owned equally (50/50) by both spouses, regardless of who earned the income or whose name is on the title.
Equitable Distribution States (41 States)
In equitable distribution jurisdictions, courts divide marital assets based on fairness rather than a strict 50/50 split. Judges weigh marriage length, each spouse's earning power, non-monetary contributions (homemaking), and economic misconduct.
Separate Property vs. Marital Commingling
Assets owned prior to marriage, or received via inheritance/gift during marriage, remain separate property—unless they were commingled with marital funds (e.g., depositing inheritance into a joint checking account to pay mortgage debt).