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Nevada Community Property Laws: How to Protect Separate Property in a Marriage (and Divorce)

Under Nevada community property laws that apply to a divorce, the spouses divide all property acquired during a marriage, except for property clearly identified as separate property. Often, separate property becomes community property subject to division because spouses commingle the separate assets with marital property. Every married person should understand these laws and know how to protect separate property throughout a marriage.

What Is Separate Property?

Separate property is property owned solely by one spouse. At the beginning of a marriage, separate property typically includes assets owned individually prior to the marriage. But if that property is commingled with marital property after marriage, it can become community property. Commingling refers to separate property being mixed with marital property, which can occur in many ways.

A spouse can acquire separate property during a marriage, but most assets acquired by either spouse during a marriage are community property. For example, any income received by one spouse is typically marital property, not the earning spouse’s separate property. For assets separately owned before marriage that appreciate during a marriage, like a retirement account or business, the appreciation often is community property subject to division in a divorce.

The most common example of separate property acquired during a marriage is an inheritance or gift received by one spouse. The property starts out as the spouse’s separate property, but it can become community property if it is commingled with marital property in a bank or other financial account or used to purchase jointly owned assets, like real estate. If commingling occurs, the separate property can become community property subject to division in a divorce, unless there are detailed records or legal documents that protect the separate property.

How to Protect Separate Property

There are several different ways that spouses can protect separate property and prevent it from becoming community property. The best solution depends on the circumstances and the nature of the assets.

Prenuptial Agreements

A prenuptial agreement is one of the most common ways to protect separate property owned by a spouse prior to a marriage. While many people think of prenuptial agreements as something only wealthy people need, that belief is a myth. Many individuals own businesses (or are part of a family business) or own other assets that can be preserved as separate property after a marriage, if the couple signs a valid prenuptial agreement before the marriage occurs.

A prenuptial agreement also may be appropriate for individuals who have children from a previous marriage and wish to protect separate property for the benefit of the children. In addition, a prenuptial agreement may be desirable if one of the intended spouses has significant debts or financial obligations prior to a marriage, and the couple wishes to avoid having the new spouse become liable for those debts.

Spouses who wish to consider a prenuptial agreement should never attempt to create one on their own. Assistance from an experienced family law attorney is essential to ensuring that a prenuptial agreement is legally enforceable in Nevada. Each person should have their own lawyer in negotiations leading to preparation and execution of a prenuptial agreement. A single lawyer cannot ethically represent the interests of both intended spouses.

Postnuptial Agreements

To protect separate property acquired after marriage or property that appreciates in value after a couple marries, a postnuptial agreement accomplishes the same goals as a prenuptial agreement does before a marriage. A postnuptial agreement also is the mechanism for a couple to use to modify the terms of a prenuptial agreement after the marriage occurs. In some situations, a postnuptial agreement is advisable when there is a substantial change in a married couple’s financial situation.

As with prenuptial agreements, a couple considering a postnuptial agreement should talk with knowledgeable family law attorneys before taking any steps toward an agreement. Nevada laws limit what can be addressed in a postnuptial agreement, so legal counsel is essential to ensuring that the agreement complies with applicable laws.

Bank Accounts and Financial Accounts

The status of separate property can be jeopardized if that property is deposited into an account that also holds marital property or if the separate property is used to improve or acquire a jointly owned marital asset. In either case, the action may change the separate property into community property. Quite simply, separate funds or assets should never be transferred between separate and community accounts. Similarly, marital property should never be transferred or deposited in a separate property account.

Schedule a Free Consultation With a Las Vegas Family Law Attorney About Separate and Marital Property

At The Gersten Law Firm, we help clients with all types of family law matters, including prenuptial and postnuptial agreements that protect separate property. Attorney Joseph Gersten has the knowledge, skill, and experience to help you assess your separate and marital property circumstances and guide you through the process of making the right determination about what is best for you and your financial situation.

If you need assistance with a family law matter in Las Vegas, Henderson, or elsewhere in Clark County, call 702.857.8777 or contact us online to schedule an appointment. Your initial consultation is always free of charge.

Categories: Nevada Family Law

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The Gersten Law Firm PLLC
9680 W Tropicana Avenue
Ste 120
Las Vegas, NV 89147
Phone: (702) 857-8777