Is Nevada a Community Property State?

Along with eight other states, including nearby California and New Mexico, Nevada is known as a community property state. This affects the division of both marital assets and debts upon the end of a marriage between both spouses.

What is a community property state?

A community property state is one in which any assets and any debts obtained during a marriage are split equally between spouses in the event of a divorce. There are some exceptions to the Nevada community property law, but generally speaking, any real property purchased jointly after the marriage—even if only one spouse's name is on any deed or title—is considered marital property and belongs equally to both spouses in community property states.

There are nine states considered community property states. The other 41 states are considered equitable distribution states. In equitable distribution states, the courts consider every relevant factor as they determine the percentage of community assets and property acquired during the marriage. The court then orders the determined equitable distribution, or fair division, of community assets and money owed during the divorce, which might not mean the property is split equally between the two people.

Pre- and postnuptial agreements agreed to by the spouses override any default marital laws.

In Nevada, what is considered community property?

In the state of Nevada, community property is any property acquired during a marriage or any property paid for with joint funds from the couple, regardless of when the property held was obtained or which spouse controls the property. For example, if only one spouse owns a home prior to marriage, but the mortgage payments are made from a joint bank account, then profits of any equity from the start of the marriage belong partially to the other spouse, no matter whose funds were technically used to make the payments, as these are considered community funds.

Assets as community property

If one spouse in a married couple purchases a car or other property, even if the purchase is made only in that spouse's name, this is community property acquired jointly. All assets obtained within the marriage are divided equally, including either spouse's earnings deposited in any joint account. This is why Nevada is known as a 50-50 state.

Exceptions to the community property rights in Nevada include any property not commingled after marriage, such as gifts, inheritances, or any personal injury damages awarded to the other spouse, all of which are considered separate property. You may want to consult a family attorney or legal services like LegalZoom.

Debts as community property

Any debt incurred during the marriage, regardless of who incurred it, is considered community debt. If either spouse obtains a car loan solely in their name but makes payments from a joint bank account, that is a community property debt. Regardless of which spouse possesses the vehicle at the time of the Nevada divorce, both parties are equally responsible for the debts acquired. An ex husband could default on an auto loan, and the ex wife would also be responsible.

There are also exceptions to community property debts, including these two categories: any debts incurred before the marriage and student loan debt. These debts remain separate since the other spouse with the student loans also takes the benefits of the education in the Nevada divorce decree.

What is separate property in Nevada?

In Nevada, separate property is that property you owned before entering into the marriage. For the entirety of that property to be separate property in the case of divorce, no community property funds should be used for the separate property after the marriage. The spouse's separate property should not have any improvements or repairs made using funds from joint accounts. Any rent or profit from the sale of the spouse's separate property remains that spouse's after a Nevada divorce.

There are some exceptions to separate property obtained after the marriage, as mentioned above, such as gifts from family members, inheritance, or a personal injury award.

In the case of divorce, the spouse must prove to the courts that the property was theirs alone prior to the marriage, or that there was a gift of separate property. This may not stop the court from requiring the separate property to be used for alimony, child support, or even be used to settle a community debt.

Property that can be both community and separate property

For the purposes of Nevada divorce proceedings, there is also a gray area of assets that can be partly community and partly separate property. The most common of these complications are retirement accounts, which will need to be divided with the assistance of a family law attorney.

Additionally, the two spouses may decide to divide their property without the courts or with the help of a mediator. Although the divorce settlement agreement can help the spouses seeking divorce to avoid many expenses, the state of Nevada requires a judge to review such an agreement to make sure it is equitable.

If you are unmarried but have community property, what happens if you split up?

Under Nevada law, any unmarried couple's property will be divided equally as community property between spouses unless there is an implied or expressed—possibly written—agreement between the two persons that the court finds in the course of any suit.

Do Nevada's community property laws include right of survivorship?

Yes, Nevada's laws include right of survivorship. Specifically, one half interest in the community property automatically becomes the property of the surviving spouse as his or her separate property. The remaining half goes to the surviving spouse in the absence of any testamentary disposition (the transfer of ownership of property through a will or trust).

Both spouses equally entering into a legal marriage within the state of Nevada should familiarize themselves with community property-related laws and make financial decisions to protect their personal property, when possible. This may involve a prenuptial agreement or a postnuptial, an agreement after the marriage. In the event of a divorce, community property issues can cause financial strain if assets are commingled in joint accounts.