What Is A Community Property Agreement
One of the advantages of classifying your property as a community is that it gets the double advantageous increase in its tax base upon the death of the first spouse, but there are other factors to consider. In some cases, a couple may waive the capital gains tax benefits of common property and classify real estate as individual in order to achieve other estate planning objectives. Possible objectives could include: fourth, a spouse cannot terminate a community ownership contract without the consent of the other spouse. Seventh, by passing all real estate directly to the surviving spouse, the couple may lose the ability to plan the estate in order to use the single inheritance tax credit that can be extinguished by the operation of the collective real estate contract. Second, the land planning contract creates a trap for the unwary. Community heritage is subject to assumptions other than separate heritage when it is divided between spouses by divorce tribunals. In general, the courts believe that the property separate from the outgoing partners should remain in the hands of the owner, without proper consideration to the contrary, while the court considers that the co-ownership should be shared equally between the spouses in the event of divorce. RCW 26.09.080 and its interpretation cases. When divorce takes place to a partner who does not assume this principle (as is often the case for one of the conjugal partners), a community ownership contract, executed to achieve cost savings from the estate procedure, can lead to the unwanted transfer of essential assets to the outgoing spouse, assets which, without the Community ownership contract, , would have stayed with the separate owner. Fifth, changing the character of the separated condominium property may subordinate the newly characterized property to the debts of the other spouse if the property was previously immune to those rights. Eighthly, a Community real estate agreement may be inoperative for the transfer of real estate to other states, particularly if they are not Member States of the Community. In case of inefficiency, you must make a secondary reduction in the state where the property is located. Married couples and domestic couples can enter into a community ownership agreement that makes all their property, both separate and collective, the property of the Community after the death of the first spouse or partner1.
Such an agreement can also be used to immediately characterize all the properties currently held by the couple and all real estate acquired in the future as common property. The complexity of these issues often leads to the use of community ownership agreements to pre-classify all of the couple`s assets as an individual or community, in order to simplify the process in the event of the death of the first spouse and reduce costs. There are pros and cons to classifying real estate as an individual or community, and choosing the most appropriate classification often involves a wealth survey for active by an experienced estate planning lawyer.