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When Is a Couple Legally Separated? Cal. Supreme Court Weighs In

The California Supreme Court ruled that couples must be living apart before they can be considered legally separated.

Whether going through a divorce or choosing a legal separation instead of a divorce, the new definition can have a huge impact on each spouse's property and finances. The court attempted to simplify matters by creating a bright-line rule based on the establishment of individual residences as creating a legal separation.

In the Dog House

Under California's marital property laws, both spouses are entitled to half of their community property -- meaning all income, assets, and property accrued during the marriage. However, any income or property acquired while the couple is legally separated is considered separate property, and does not get split in the divorce.

But how do you know exactly when the legal separation starts? The court in this case tried to create an absolute boundary: "Living in separate residences is an indispensable threshold requirement for a finding that spouses are living 'separate and apart' for purposes" of dividing marital property in the event of a divorce.

Divorce proceedings are notoriously contentious, and the court seemed to be trying to take at least one argument off the table:

"A bright-line rule ... promotes fairness by providing a measure of predictability to the parties and their attorney, as well as clear guidance to judges ... It reduces the potential for manipulation of a more elastic standard by the higher earner in situations of significant income disparity."

On the Fence

While legal separation is a midway point on the way to divorce for some couples, others have chosen a legal separation as the destination. In lieu of a full divorce, a legal separation can:

  • Provide continued tax benefits: in some states, separated couples can still retain the tax benefits of filing joint tax returns.
  • Provide continued health insurance benefits: some insurance plans continue to cover separated spouses so long as they're still technically married.
  • Retain the religious sanctity: not all religions, or their adherents, believe that divorce is a legitimate option.

It remains to be seen how the California ruling will effect decisions to legally separate, or to remain cohabitating, or to divorce.

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