The process of California estate planning might seem overwhelming if you’ve never done it before or if you’ve recently relocated to the state and are curious about whether or not your existing estate planning documents will do the job if and when you become incapacitated or pass away.
One common question that emerges and is brought to the attention of experienced California estate planners is what happens to community property when you pass away. The state of California defines community property as anything that was acquired during a domestic partnership or a marriage.
Community property is formally classified as being owned equally by both parties. Partners or spouses are presumed to contribute equally to the earnings associated with the marriage, so community property can include income that was earned during the course of the partnership or marriage. It’s important to remember that community property does not include any separate property. Using a will, an individual who owns community property can transfer their half of the property to a beneficiary.
That surviving partner or spouse will still own the other half. If the partner passes away without a will, the partner or deceased spouse’s half of the community property automatically passes on to the partner or surviving spouse. Separate property includes gifts, inheritances, property owned or acquired before the partnership or marriage, property separate by agreement of the spouses, property acquired after the parties separate or property that was acquired with the proceeds of separate property not intended for the benefits of both partners.
Curious about planning ahead for your assets? Talk to an estate planning attorney in Pasadena to discover more about the process.