Property Division Generally
In a divorce, the court recognizes two types of property in Colorado: marital property and separate property. For most people, anything purchased or obtained in a marriage is marital property. Separate property is only that which is received by a party as a gift or an inheritance, or is property which was owned prior to the marriage. Even with separate property, if it is worth more at the time of the divorce, the increase in value is marital property. That means that marital property is anything acquired by either person during the marriage, including the appreciation on separate property during the marriage.
Marital property is divided equally between the parties but separate property is allocated to the owner. Appreciation of equity on separate property is equally divided.
In order for property to qualify as separate property, it must have been kept separate from marital property. For example, if money was inherited by one spouse prior to the marriage, but was then placed into a joint bank account from which the parties paid for marital expenses, what had been a separate inheritance will likely be treated as co-mingled marital property.
Colorado is not a “community property” state, which means that assets and debts are not automatically divided 50/50 between spouses. In practice, however, the marital property and debt are often divided close to 50/50.