Divorce And Debt: Am I Responsible For My Spouse’s Debt?

The issue of divorce and debt is a stressful one. If you are in the process of getting divorced, you may be concerned with whether or not you’re liable for your spouse’s debts.

Are you thinking about divorce and debt? First, find out if you live in a state that is a community property state like California or if you live in an equitable distribution state like New York.

In an equitable distribution state, debts incurred by one spouse are typically that spouse’s debt alone. Many exceptions apply including if the debt was for a family necessity such as food or rent, or child care.

• In addition to one spouse’s debt being theirs alone, in equitable distribution states or “common law” property states, one spouse’s income doesn’t necessarily become jointly owned.
• Unless, both names are on titles and leases, typically this property is considered the debts of one spouse.
• However, judges may rule otherwise depending on the circumstances.
• Income can become jointly owned in equitable distribution states if a couple places the income in a joint bank account.

If you live in a community property state, then yes, debts incurred by one spouse are typically shared by both spouses. “Community” refers to the couple, so community property is essentially the couple’s property.

• Community property, however, only refers to property obtained during the marriage. For instance, if one spouse incurred a student loan debt prior to the marriage, that debt is that spouse’s alone.
• Additionally, any debts incurred after the couple has legally separated, debts incurred by one spouse are typically their debts alone.
• Again, exceptions apply, including if the debt incurred was a family necessity.

What is shared in community property states?

• The couples income earned during the marriage is shared.
• Any property purchased during the marriage is shared.
• Debts are shared and creditors can go after a spouse for joint debts.

What is not shared in community property states?

• Any gifts of inheritances received during the marriage (as long as they’re not from the spouse) are separate.
• Any property purchased prior to the marriage are separate.
• Any income and property acquired after a legal separation are separate.
• In community property states, couples can sign agreements to treat debts as separate.

For information about finding a divorce attorney and what to expect at your first meeting with an attorney, click here.

For information about property division in an equitable distribution state such as New York, click here.