Here’s What Tempe Residents Should Know About Community Property in Bankruptcy

If you’re a Tempe resident considering filing for bankruptcy in Arizona, it’s important to learn about how filing affects community property.

If you really want to understand community property in bankruptcy, you’ll need to speak with a knowledgeable Tempe bankruptcy lawyer. Your lawyer can explain anything you don’t understand, answer all of your questions, and give you peace of mind.

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One of the biggest mistakes people make when filing for bankruptcy in Arizona is not consulting with a Tempe bankruptcy attorney.

A Tempe Bankruptcy Lawyer can help you:

• Decide if bankruptcy is right for you
• Choose the right chapter to file under
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• Answer any questions you may have regarding bankruptcy, your credit, etc.
• Understand Arizona collection laws
• Understand how bankruptcy may affect your family
• Make the best decisions for your finances and your future

Our team of dedicated Tempe bankruptcy attorneys can help you through bankruptcy in Arizona.

What Is Community Property in Bankruptcy?

Personal bankruptcy when married can be different than if you’re single. When you file for bankruptcy in Arizona, it affects your spouse, too. This is true even if you file individually.

Each state has different laws which affects the property rights you hold during marriage. Your state will either be common law or community property.

Community Property states include:

• Texas
• Arizona
• New Mexico
• Louisiana
• California
• Washington
• Idaho
• Nevada
• Wisconsin

In Community Property states, any property obtained by either spouse in a marriage is considered “community property.” In other words, 50% of whatever you own – even if you obtained it on your own – belongs to your spouse. All property is divided in half equally, 50/50.

This also includes:

• Monetary earnings
• Any property bought with those earnings
• All debts accrued during the marriage

This begins on the marriage date and ends if and when the couple physically separates. So if you are getting divorced, note that any debts or earnings after this time are not considered community property.

Treatment of Community Property in Bankruptcy

It’s essential to understand how ownership of property is handled in your state because it will determine how some of your household property will be treated in bankruptcy.

Here’s what Tempe residents should know about community property in bankruptcy:

• NOT Community Property: Anything acquired by one spouse BEFORE the marriage is not considered community property in bankruptcy. Rather, it solely belongs to the spouse who acquired it. For example, if your husband bought a car before you got married, that car is his property, and not community property. That car would not be considered part of the bankruptcy estate if that spouse does not file.
• Community Property: Anything acquired by either spouse AFTER the marriage is considered community property in bankruptcy. In this case, the property is owned by both spouses. Even if your spouse is not filing for bankruptcy with you, that property is considered in the bankruptcy estate. For example, say you purchased a motorcycle after you got married. Even if you paid for it with your own money, you bought it after getting married. Hence, it is considered part of the bankruptcy estate.
• NOT Community Property: Anything acquired by one spouse AFTER a separation or divorce is not community property. It is extremely important to remember the exact date you separated from your spouse for this reason. If you file for bankruptcy after separating from your spouse and your spouse buys a new car, that new property will not be included in the bankruptcy estate – even if you are still technically married to them.

Need help with bankruptcy in Arizona? Speak with a Tempe Bankruptcy Attorney Today!

If you’re struggling with bankruptcy in Arizona, you should call the best bankruptcy attorney in Tempe: Davis Miles McGuire Gardner, PLLC. As a knowledgeable, experienced Arizona bankruptcy lawyer in Tempe, our team of highly experienced experts can help you through every step of the bankruptcy process. Call us today at (480) 733-6800 to schedule a consultation!

What Tempe Residents Should Know About Community Property in Bankruptcy | Davis Miles McGuire Gardner, PLLC – Tempe, AZ