What is Commingled Property in a Divorce?

Anyone who is getting divorced in South Carolina should know about property division rules. Under South Carolina law, all marital property is divided equitably between the parties. Indeed, South Carolina is known as an equitable distribution state. This means that the court will account for all property owned by the parties — separate (“nonmarital”) and marital property. It will classify property accordingly, and spouses can keep their separate property. Marital property, however, will be divided between the parties. In theory, the court will be able to determine clearly which property is separate and which is marital. In some cases, however, that process might be more complicated. When separate and marital property gets mixed, or “commingled,” additional steps usually must be taken.

Understanding How Property is Classified

What constitutes separate property and what constitutes marital property in South Carolina? According to South Carolina law, marital property “means all real and personal property which has been acquired by the parties during the marriage and which is owned as of the date of filing or commencement of marital litigation . . . regardless of how legal title is held.” Accordingly, nonmarital or separate property means all real and personal property acquired by either spouse prior to the date of the marriage. In addition, there are exceptions for certain types of property acquired or accrued after the date of the marriage. The statute also lists the following property, acquired during the marriage, as nonmarital or separate property:

  • Inheritances;
  • Third-party gifts (gifts from someone other than the spouse);
  • Property acquired after a marital settlement agreement;
  • Property excluded through a premarital agreement or other contract between the spouses; and
  • Increase in value of nonmarital property during the marriage.

All property includes both assets and debts. When courts divide marital property, they look at a range of factors listed in the South Carolina Code.

How Does Property Get Commingled?

Now that you understand how property gets classified, what does it mean for it to get commingled? Various situations can result in separate or nonmarital property becoming fully or partially marital property. In other words, separate property somehow gets mixed with marital property. When this happens, the classification of the property becomes complicated. Typically, the court will attempt to untangle the marital property from the nonmarital property so that the marital property can be divided. In some cases, such as when the untangling is particularly complex or the property has become especially commingled, the separate property may simply be classified as marital property.

How does property get commingled? The following are some examples:

  • Using separate assets to put a down payment on a marital home;
  • Paying bills during the marriage with separate assets; or
  • Improving nonmarital real property with marital assets (such as renovating real property that was purchased by one of the spouses before the marriage).

Contact a South Carolina Divorce Lawyer

If you have any questions about property division in a South Carolina divorce more generally, or if you have particular concerns about commingled property, one of our Charleston divorce attorneys can help. Contact The Peck Law Firm online or call us at 843-631-7117 for more information.

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