By: Martin M. Shenkman, CPA, MBA, JD
Nine states have community property laws that affect how the ownership of property is handled for divorce, estate and other purposes. These states include: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. If you live in a non community property state but may have community property (e.g. you lived in a community property state while married then moved to a non community property state) this fact should be addressed by someone with expertise in community property laws in the state that may have affected the assets in question. In general terms, community property states deem property of a married couple to be owned 1/2 by each spouse. In contrast to the treatment of jointly held property in other states, in a community property state if one spouse dies all of the community property may receive a step up in income tax basis.
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