People often ask: is Colorado is a community property state? The short answer is no, Colorado is not a community property state. Instead, Colorado courts divide the property of divorcing couples using a method called “equitable distribution.” But what does that mean? Does it mean equally (50/50)? Not necessarily.
(Note: The nine states that DO have a community-property system are: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin.).
What Does “Equitable Distribution” Mean?
Colorado judges are not required to divide a marital estate equally in half and award each party 50%. Instead, Colorado judges are tasked with dividing the property in a fair and impartial manner, considering the facts and circumstances of the case to determine what is “fair” or “equitable” and not necessarily equally. This is in contrast to some other states where the property is held as “community property.” Under Colorado law, the factors that a court will consider in determining what is fair and equitable for purposes of dividing marital property are:
- All relevant factors (essentially anything that matters)
- The contribution of each spouse to the acquisition of the marital property, including the contribution of a spouse as homemaker;
- The value of the property set apart to each spouse;
- The economic circumstances of each spouse at the time the division of property is to become effective, including the desirability of awarding the family home or the right to live therein for reasonable periods to the spouse with whom any children reside the majority of the time; and
- Any increases or decreases in the value of the separate property of the spouse during the marriage or the depletion of the separate property for marital purposes.
When a court hears your case, they will analyze each of these factors to determine whether a 50/50 division is appropriate or whether the court should deviate and award one party more than 50/50.
Factors For an Unequal Division
- Dissipation of marital assets
- Unequal contribution to the marriage
- A lack of adequate income for maintenance
- A large amount of separate property
- And many other reasons
Typically, How Do Colorado Courts Equitably Divide Property?
In my experience, the judge will initially consider a 50/50 division and then determine if an equal division is fair based on all of the information at the judge’s disposal. The judge can take into the statutory factors identified above but can also consider essentially any relevant information that tends to show a particular division would be fair or unfair. However, the judge does not have the authority to divide property that is determined to be the separate property of one of the parties. The judge can only apply the rule of equitable distribution to “marital property.”
However, if a spouse has a considerable amount of separate property such as property received as part of an inheritance, the judge may decide that the other spouse should receive more than 50% of the marital assets. The fact that one spouse has financial resources that the other spouse does not have, constitutes an “economic circumstance” and is a relevant factor that the judge can rely upon in awarding one spouse a larger share of the marital property (60/40 for example). In this way, the court can fairly and equitably divide the financial resources of the parties; however, this does not mean that the judge would award all of the marital property to one spouse because the other spouse has significant separate assets. It would be quite unusual for a judge not to award a spouse any of the marital property.
How do you Ensure That You Get a Fair and Equitable Division?
In each case, there are important facts and circumstances that a judge may consider relevant in deciding how to divide the assets and debts in a divorce. There is no formula that the judge is required to follow and, in the end, it is entirely within the judge’s discretion to decide what an equitable distribution is in any given case. It is for this reason that clients need excellent representation. When virtually all factors are relevant to the ultimate division of assets, ensuring that your attorney understands your case and advocates your cause is paramount.
Leslie Hansen is a Shareholder at Griffiths Law PC. She has a background as a prosecutor with extensive litigation experience and now uses those skills in Family Law. She was recognized by The Best Lawyers in America© in 2018-2019 for family law.