is colorado a community property state?
One of the biggest misconceptions in a divorce case is how property should be divided. There is a substantial amount of misinformation out there, and the problem is that every state handles marital property differently. There are the questions of what exactly is marital property, how is property kept separate, how inheritance is qualified and what happens when property is co-mingled.
The biggest question for Colorado divorces is whether the state follows community property laws. The quick answer to that is No. Colorado is not a community property state. What is Colorado then? Colorado follows what we refer to as an equitable distribution model. It is important to understand that “equitable” does not, but could, mean “equal.”
Unlike community property states, where marital assets are split 50/50 regardless of various factors, how property is titled, or when property was acquired, Colorado courts divide property based on what is fair and just—which does not always mean equal.
When determining how property (and debt) should be allocated between spouses, Judges will consider almost anything and everything that is presented to them during trial. The most common factors the Court is going to consider are:
What was each spouse’s financial contributions to the marriage?
What are the economic circumstances of each spouse leaving the marriage?
Is there separate property? What is the value of that property?
Sometimes, but not often, the Judge may consider whether one spouse “wasted” any of the marital funds. Clients commonly come in wanting to argue this point, but marital waste is a rarely successful argument – the circumstances need to be significant to successfully argue marital waste.
The equitable distribution model is a flexible approach that allows Judges to formulate an asset division based on the couple’s unique circumstances rather than rigidly splitting everything down the middle. This is often encouraging to spouses who may not have “equally” contributed to the marriage financially, or who have significant separate assets.
Understanding Colorado’s property division laws is essential for anyone going through a divorce for planning their financial future. If you are facing these issues, consulting with a qualified attorney can help ensure your rights and interests are protected.