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- 9 min read
- California is one of 10 community property states.
- Debt created during marriage in California is presumed to be community debt.
- You may have liability for your spouse's pre-marital debt in California.
- Start your FREE debt assessment
Table of Contents
Learn if You Must Pay Your Spouse's Debts in California
California is one of 10 community property states. You may have to pay your spouse’s pre-marital debt even if you did not know anything about it. But California’s community property law is not simple, so do not assume you must pay your spouse’s debt without understanding California’s rules first. To complicate matters further, a separate law called the doctrine of necessaries may obligate you to pay your spouse’s debt in California. If you are married and reside in California, learn if you have liability for your spouse’s debt.
This article focuses on your liability for your spouse’s debt, but there’s much more to California’s community property law than spousal debt. See California Family Code and the Judicial Council of California’s Divorce or Separation Web pages to learn how California handles divorce, property rights, and credit applications.
| Community Property States |
|---|
| Alaska* |
| Arizona |
| California |
| Idaho |
| Louisiana |
| Nevada |
| New Mexico |
| Texas |
| Washington |
| Wisconsin |
| * Optional |
Source: Bills.com
Community Property at a Glance
In community property states, the presumption is wealth or debt created during the marriage is part of the marital community. Therefore, courts in community property states assume a debt incurred from the date of marriage to the date of divorce is a community debt that is to be divided equally between the spouses.
Many courts in community property states assume the rents, profits, and issues of separate property remain separate. The fruits of community property are community assets. If a spouse claims a certain property is separate, it is up to that spouse to prove the property was acquired with separate funds or separate credit.
By contrast, separate property is property acquired before marriage, and property acquired by a spouse during marriage through gift, inheritance, or an award for personal injury damages.
Spousal Liability For Debt in Community Property States
Let us assume you live in a community property state. A creditor files a lawsuit against your spouse for a breach of contract relating to the default on a credit card balance. In most community property states, the spouse of the defendant has liability under community property laws. The creditor may have the option of file a lawsuit against the defendant’s spouse. If the spouse of the debtor is sued, and the court considers this particular debt as community, then the non-debtor spouse could challenge their liability in court and may be able to avoid a judgment.
Spousal Liability For Debt in California
California is a community property state. California courts define community property as the earnings during marriage that are the product of a spouse’s time, efforts, energy, and skill. In California, the presumption is all property acquired during marriage is community property. Property acquired before marriage is considered separate, unless the parties transform the assets into community debt.
In California, pre-marital debt is treated differently from assets. See California Family Code Section 910(a), which reads in part:
"Except as otherwise expressly provided by statute, the community estate is liable for a debt incurred by either spouse before or during marriage, regardless of which spouse has the management and control of the property and regardless of whether one or both spouses are parties to the debt or to a judgment for the debt."
In other words, community funds may be reached by a judgment-creditor to satisfy a debt. However, the wages of a debtor’s spouse cannot be reached by a judgment creditor. See California Family Code Section 911:, which reads in part:
"The earnings of a married person during marriage are not liable for a debt incurred by the person’s spouse before marriage. After the earnings of the married person are paid, they remain not liable so long as they are held in a deposit account in which the person’s spouse has no right of withdrawal and are uncommingled with other property in the community estate..."
In practice, judgment creditors rarely pursue spouses of judgment debtors in California because they cannot pursue a wage garnishment, which is usually the most lucrative remedy available. However, if the spouse has significant separate assets, then the creditor can pursue those subject to the restrictions of Family Code 913 and 914. Let us start with 913:
The separate property of a married person is liable for a debt incurred by the person before or during marriage. (b) Except as otherwise provided by statute:
- The separate property of a married person is not liable for a debt incurred by the person’s spouse before or during marriage...
This seems to take the non-debtor spouse off the hook. Not so fast. See § 914:
- Notwithstanding Section 913, a married person is personally liable for the following debts incurred by the person’s spouse during marriage:
- A debt incurred for necessaries of life of the person’s spouse while the spouses are living together.
- Except as provided in Section 4302, a debt incurred for common necessaries of life of the person’s spouse while the spouses are living separately.
- The separate property of a married person may be applied to the satisfaction of a debt for which the person is personally liable pursuant to this section. If separate property is so applied at a time when nonexempt property in the community estate or separate property of the person’s spouse is available but is not applied to the satisfaction of the debt, the married person is entitled to reimbursement to the extent such property was available.
In other words, under Family Code 914 (b) accounts and funds the non-debtor spouse has kept separate may not be touched if the debt was not for the necessaries of life. However, if the debtor-spouse spent the money on luxuries, then the non-debtor spouse’s separate property (accounts) cannot be touched.
Community funds, however, may be reached by a creditor to satisfy a debt.
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Start nowIt is rare for judgment-creditors to pursue spouses of California debtors. Perhaps non-California judgment-creditors do not understand California law. Perhaps spouses of debtors do not have significant assets. Whatever the reason, the practice of pursuing spouses is unusual, but not prohibited in all cases under California law.
Consult with a California lawyer who has family law experience to learn more about California community property law. If you cannot afford a lawyer, contact Law Help CA or another California pro bono program to find low- and no-cost legal services.
| California Community Property Law at a Glance | ||
|---|---|---|
| Husband or wife liable for debts of other incurred before marriage? | The community estate is liable for a debt incurred by either spouse before or during marriage. However the wages of a debtor’s spouse cannot be reached by a judgment creditor. | |
| Husband or wife liable for debts of other incurred during marriage? | Yes for "necessaries of life" and no for non-necessaries.* | |
| When do spouses become subject to state community property laws? | When the spouses are married and domicile in the state. | |
| Does the state recognize common law marriage? | No, but it recognizes a common law marriage legally established elsewhere. | |
| Does the state recognize some from of domestic partnership as an alternative to marriage? | Yes. | |
| Does a domestic partnership under state law create community property rights and obligations? | Yes. | |
| When does the community property regime terminate (causing subsequently acquired assets or future income to no longer be characterized as community property)? | Change of domicile, death of spouse, living separate and apart before dissolution with no present intent to resume marital relations and conduct evidencing a complete and final break in the marital relationship, legal separation or judgment of dissolution. | |
| How is post marital income generated from separate property (e.g., rents, dividends, interest) characterized? | Separate property unless a portion is derived from CP time effort and skills. If so, an allocation must be made. | |
| How does the state characterize appreciation in the value of separate property? | Separate property where appreciation is a "natural enhancement of SP" and spouse has expended a minimum of effort or effort has insignificant value. If spouse’s labor or CP funds are used to acquire or improve the SP, a right of reimbursement exists, but does not change the character of the SP. A federal tax lien attaches to the right of reimbursement. | |
| How does the state characterize property taken by spouses under a deed reflecting that the property is held in joint tenancy? | The property is rebuttably presumed to be a joint tenancy. Factors rebutting the resumption include: If acquired during marriage, if acquired with CP funds, if parties knew the legal consequences of JT vs. CP, if loan proceeds deposited into CP account. | |
| How does the state characterize property taken by spouses under a deed reflecting that the property is held in tenancy in common? | The property is rebuttably presumed to be separate property. Very uncommon form of ownership between spouses. | |
| Does a deed taken in the name of one spouse as sole and separate property create separate property? | No. Title does not determine the character of the property. It is rebuttably presumed to be community property. | |
| Does the state recognize pre or post marital property characterization agreements? | Yes. | |
| What are the property characterization agreements called? | Premarital, post-marital, prenuptial or postnuptial agreements. | |
| Are property characterizations agreements required to be in writing? | Premarital agreements must be in writing. Postmarital agreements need only be in writing if they involve real estate. | |
| Are property characterization agreements valid against creditors? | Yes. Premarital contracts before 1986 required to be recorded. After 1986, no need for recording to be valid. Premarital not subject to fraudulent conveyance laws. Post-marital need not be recorded, but are subject to fraudulent conveyance laws. | |
| What property is available to satisfy a premarital federal tax obligation assessed against only one spouse? | 100% of all community property and all separate property of the liable spouse. | |
| What property is available to satisfy a post marital federal tax obligation assessed against only one spouse? | 100% of all community property and all separate property of the liable spouse. | |
| California Community Property law: Calif. Family Code 913 and 914 * Calif. Family Code § 914(a) | ||
California Community Property Law. Source: IRS and Bills.com
California Doctrine of Necessaries
California residents who wrestle with a spousal debt question must know community property law and the doctrine of necessaries to understand their liability for a spouse’s debt. California’s doctrine of necessaries law is woven into its community property law, as discussed above.
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Learn moreThe doctrine of necessaries is a law giving creditors a right to collect a certain type of debt from a debtor’s spouse or the parent of a minor child. Some states repealed their doctrine of necessaries laws. California has not. To learn more about California’s doctrine of necessaries rule, read the Bills.com article Doctrine of Necessaries Rules For All States.
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Debt statistics
Mortgages, credit cards, student loans, personal loans, and auto loans are common types of debts. According to the NY Federal Reserve total household debt as of Q1 2024 was $17.69 trillion. Housing debt totaled $12.82 trillion and non-housing debt was $4.88 trillion.
A significant percentage of people in the US are struggling with monthly payments and about 26% of households in the United States have debt in collections. According to data gathered by Urban.org from a sample of credit reports, the median debt in collections is $1,739. Credit card debt is prevalent and 3% have delinquent or derogatory card debt. The median debt in collections is $422.
Collection and delinquency rates vary by state. For example, in Arkansas, 15% have student loan debt. Of those holding student loan debt, 10% are in default. Auto/retail loan delinquency rate is 5%.
To maintain an excellent credit score it is vital to make timely payments. However, there are many circumstances that lead to late payments or debt in collections. The good news is that there are a lot of ways to deal with debt including debt consolidation and debt relief solutions.
Hi good evening, I own a business . My spouse wa never involved in it . How I can protect community property from creditors if I file business bankruptcy?
You need to speak with a bankrutpcy attorney ASAP. Your question is perfectly fine, but it is too important to get an answer from anyone who is not a lawyer.