Is Tennessee a Community Property State?

One of the most arduous aspects of divorce is figuring out what’s mine, yours, and ours. No matter how long you and your partner have been married, it’s likely that you’ve been mixing your stuff together since early on in the relationship. Teasing out which assets and debts belong to each half of the couple takes time.

Across the United States, shared property is handled differently during divorce. A few states across the U.S. follow community property laws. These nine states that use community property law divide all joint assets and debts equally, using a 50-50 split. These states are known as community property states.

Tennessee: Is it a community property state?

The short answer: no. Tennessee is not a community property state and doesn't abide by community property law.

Tennessee, like the majority of other states in the U.S., follows equitable distribution laws. Most states in the U.S. do not use community property law. There are only nine community property states in the U.S.

Community property or marital property could include:

• Income earned during the marriage
• Loans taken out
• Real estate
• Savings and retirement accounts
• Property, such as cars or furniture

While a 50-50 split of property might sound fair, many states have moved toward a more equitable division system that assesses the unique qualities of the couple and individuals in that relationship.

Unlike community property laws, equitable distribution laws aim to create an equitable divorce agreement instead of an equal one. The negotiations might start at 50-50 but then can adjust to encompass the unique needs of both individuals. These laws allow courts to account for intangible or non-monetary factors that could affect the partners post-divorce. Community property laws only allow for a 50-50 split and don't consider any additional factors.

How to classify community property in a prenup or divorce

As an equitable distribution state, Tennessee courts attempt to create an equitable distribution of property in the case of divorce. But, if you want more control over how your marital property, assets, and debts will be divided in the event you and your partner divorce, you can create a prenup. 

A prenuptial agreement is a contract drawn up prior to marriage where a couple agrees upon the division of shared property in the event they get divorced. This agreement can be updated over the years to include newly acquired community property. If you’re already married, you can create a postnuptial agreement which is essentially the same, only it’s created after the wedding has taken place.

During the divorce process, you’ll start with the discovery phase. This is where all property, both individual and marital property, is identified, classified, and valued. The steps include:

1. Identifying each asset
2. Classifying whether the asset is individual or community property
3. Valuing the assets
4. Dividing the assets between spouses equitably

If you are creating a prenup or getting divorced, it’s important to understand how property can be defined. All property, debts, and other assets can be placed into three categories: mine, my ex’s, and joint. “Joint” includes all marital or community property.

Marital or community property

Any property acquired while spouses are married is considered marital property.

Assets acquired during marriage might include:

• Loans
• Credit cards
• Real estate
• Cars
• Furniture
• Businesses
• Investments
• Savings

Property acquired while you’re married to your partner is considered jointly owned and, therefore, becomes community property. Anything that is “ours” must be divided between you and your partner upon divorce.

Individual or separate property

Separate property is an asset or debt that is owned outright by one of the people within the couple. 
In Tennessee, the separate property could include:

• An item or property that you owned before getting married
• Profits or appreciation on property you owned before getting married
• Money awarded in a legal dispute for civil damages
• Inherited or gifted property
• Commingled property

While differentiating community property from separate property might seem simple and straightforward, it can quickly get complicated. 

Consider this scenario: Brenda and Alex, a couple, decide to get divorced. Brenda owned a house before they got married. Alex moved in and they lived together in the house for 15 years. Alex and Brenda both paid for the upkeep and mortgage on the home.

Who does this property belong to when Alex and Brenda get divorced?

The house would be considered commingled property. Although Brenda owned it before they got married, which would have initially made it a separate property because they both lived there and paid for the upkeep, it was treated during the relationship as community property.

A judge can decide what was once individual property and what has become, over time, marital property through commingling. The house would now be considered community property.

Dividing community property with an equitable distribution process

Once property has been divided into the proper categories, it’s time to distribute it between the partners. Because Tennessee is not a community property state, the property division will be equitable.

Common property law dictates that each partner automatically keeps any property that’s been decided as separate property and belongs to them. All community property will be distributed equitably between the two partners.

A number of different factors can influence equitable distribution. These include:

• The number of years you were married
• The standard of living during the marriage
• The age, health, education, skills, and earning capacity of each spouse
• If and how either partner was wasteful
• If and how much alimony each partner might receive
• The projected income of each partner post-divorce
• Intangible contributions, such as homemaking or support during education
• Whether or not one spouse is in the military

A judge can deem any other factor relevant and use it to determine equitable distribution of community property between partners. None of these factors would be considered in a community property state.

Fault-based divorce and the division of property

Tennessee is one of only a few states in the U.S. that still allows fault-based divorce. 

A finding of fault in divorce will have no bearing on the division of community property between spouses. However, fault can affect how much alimony you’re entitled to post-divorce and can influence child custody decisions.

Simplify and get a prenup or postnup

If you want more control over how your assets are divided between you and your spouse in case you get a divorce, you’ll want to consider a prenup or postnup. These contractual agreements are between two spouses either before or after marriage on the division of property, assets, and debts. 

A prenup or postnup can be beneficial to anyone, whether they live in a community property state or an equitable division state like Tennessee.

The final word: Is Tennessee a community property state?

Tennessee, like the majority of other states in the U.S., is an equitable division state. Tennessee is not one of the few community property states in the U.S. and doesn't abide by community property law.

This means that when a couple divorces, community property, assets, and debts are divided between the two spouses equitably, which might not be equal. Equitable distribution takes into account many factors about each spouse's future life without the other. 

FAQs

What is considered community property in Tennessee?

In Tennessee, marital or community property can include any debts, assets, or property that’s acquired during the marriage. Though Tennessee is not one of the community property states, couples still possess community or shared property.

Is Tennessee one of the community property states?

No, Tennessee is not a community property state. Tennessee is an equitable distribution state.

The divorce negotiations start at a 50-50 split of property but may end with one spouse receiving more based on intangible factors such as future income earning potential or contribution to one spouse’s education. 

Does Tennessee follow community property laws?

Tennessee is not a community property state but it does still have laws that regulate community property rules.

Community property, also known as marital property, is any property, asset, or debt that the couple acquires while married. Tennessee is not one of the community property states in the U.S.

What factors are considered for equitable distribution?

Factors that are considered by an equitable distribution state during divorce include how long you’ve been married, the projected income, age, health, education, and skills of each partner, and the standard of living during marriage. Other relevant factors may also be considered.