Wisconsin is a marital property state, also called a community property state. This means that any assets or debts acquired or shared during the marriage are owned equally by both parties. Some key exceptions include inherited property, gifted property, and assets excluded through a prenuptial agreement.
The Wisconsin Marital Property Act of 1986 promotes the policy of supporting the marital relationship as an equal partnership and establishes Wisconsin as a community property state. Regardless of who makes a higher income or how household labor is divided, Wisconsin spouses share equally in the fruits of the marriage. Pursuant to this policy and subject to a few exceptions, Wisconsin law presumes all property either spouse acquires during the marriage to be marital property. Any and all marital property is subject to property division in the event of a divorce.
Marital property includes income, possessions, or debt in which spouses share an equal interest. Property in a marriage is considered individual property if only one spouse owns an interest in it. Some ways property becomes characterized as marital property include:
Wisconsin designates the day from which all property spouses acquire will be presumed to be marital property as the Determination Date. The statute specifies that the “determination date” is whichever of the following was the last to occur:
If the date of marriage is earlier than the determination date, the property owned before that date is not subject to the Marital Property Act presumption. For example, if a married couple moves to Wisconsin, the property each spouse acquired before becoming a resident of Wisconsin does not automatically become marital property.
Married people can own individual property so long as the property remains separate. Typical examples of individual property include gifted property, inherited property, and property acquired by a spouse prior to the determination date.
However, a spouse’s individual property will lose its individual status if it is mixed with marital property. For instance, depositing inherited money into a joint bank account likely transmutes the property because it complicates tracing those funds and demonstrates an intent to share the money with the other spouse.
It is also important to note that merely having one spouse’s name on the property title does not classify the item as individual property. Instead, holding property under one spouse’s name only grants the named spouse the ability to act alone in managing and controlling the property. The right to manage and control marital property does not determine the classification.
Either spouse has the right to manage and control an item of property that is not held in either spouse’s name. When property is held in the name of both spouses, the couple may manage and control the marital property only if they act together.
If you and your spouse wish to avoid Wisconsin community property law, it would be a wise decision to hire attorneys to draft and enter into a Marital Property Agreement before or during your marriage. A marital property agreement is what the state of Wisconsin calls a post-nuptial or prenuptial agreement.
Among other things, the agreement allows you and your spouse to choose how to classify certain property and/or assign certain debts. In the event of a divorce, a valid marital property agreement would dictate the division of your marital property, rather than Wisconsin law.
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