An Explanation of Commingling

Let's Untie the Knot | An Explanation of Commingling

In the context of divorce, commingling is when one spouse’s separate property is mixed with the other spouse’s marital property.  Commingling can occur when a spouse uses marital funds to improve, maintain, or contribute to separate property.  All the property that you acquire prior to marriage is yours and yours alone—it is 100% owned by you.  Once you’re married, that separate property still remains separate—unless its “commingled” with any property owned by your spouse.  Commingling occurs, for instance, when you bring a house into the marriage and start using funds from a joint bank account to pay the mortgage.  Once that occurs, the house becomes “marital property” and will be subject to equitable distribution if you get divorced.  Divorce settlements often depend upon the extent to which funds were merged. 

The following are some examples of separate property that became marital property through the process of “commingling”:

  • Inherited money that’s deposited into a joint account
  • A car brought into the marriage by one party whose maintenance is paid for by funds located in a joint account.

The following are some ways to avoid commingling funds:

  • Obtain a prenuptial or postnuptial agreement that states in unambiguous language what property will and will not be considered marital property in the event of a divorce.
  • Use marital—not separate property to pay off marital debt. For instance, if you receive an inheritance or a gift of money, do not use it to pay off joint credit card debt.
  • Keep your name—and only your name—on any deeds to separate property. And if that property ever requires maintenance, use only your funds to pay for it.
  • Maintain separate bank accounts: Only deposit money into a joint account to pay for marital property.

Although it may be awkward to have a discussion with your spouse about maintaining separate property as separate, it will save you headaches down the road should anything go wrong.  Remember to keep detailed records of purchases made throughout your marriage so that it is easier to determine what is separate and what is marital property.

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