Common Law Property

DEFINITION of 'Common Law Property'

A system used by most states to determine ownership of property acquired during marriage. In contrast to the community property system, the common law property system states that property acquired by one member of a married couple belongs solely to that person unless the property is specifically put in the names of both spouses.

BREAKING DOWN 'Common Law Property'

Under the common law property system, if a married woman purchases a car and puts only her name on the title, that car belongs exclusively to her. If the woman lived in a community property state, however, the car would automatically become the property of both the woman and her husband.

For a married couple living together in harmony, the technical details of ownership may seem trivial. However, the details can become very important during divorce or upon death.

RELATED TERMS
  1. Title

    The right to the ownership and possession of any item that may ...
  2. Marital Property

    A U.S. state-level legal distinction of a married individual's ...
  3. Community Income

    Income earned by taxpayers who live in community property states. ...
  4. IRS Publication 555

    A document published by the Internal Revenue Service (IRS) that ...
  5. Property Manager

    An individual or company responsible for the day-to-day functioning ...
  6. Equitable Division

    A legal theory that guides how property acquired during the course ...
Related Articles
  1. Retirement

    Holding Titles On Real Property

    Find out how best to claim and convey ownership on your assets.
  2. Personal Finance

    The Complete Guide To Becoming A Landlord: Hiring A Property Manager

    A property manager can perform such duties as marketing your rental property, selecting tenants, maintaining the property, creating budgets and collecting rent. You may consider hiring a property ...
  3. Personal Finance

    Investing In Property Out Of State

    If you can't afford property close to home, consider taking the real estate plunge elsewhere in the country.
  4. Trading

    Use Real Estate To Put Off Tax Bills

    Find out how you can build wealth and reduce your taxes.
  5. Personal Finance

    Investing In Foreclosures Not A Get-Rich-Quick Venture

    Investing in this kind of real estate takes capital, time and careful planning.
  6. Personal Finance

    Getting U.S. Tax Deductions On Foreign Real Estate

    If your home or second home is not in the United States, you can still get U.S. tax deductions. How many and what kind depends on whether you also rent it.
  7. Personal Finance

    Sell Your Rental Property For A Profit

    Being a landlord can be taxing, especially when you want to sell. Find out how to reduce your burden.
  8. Personal Finance

    What You Should Know About Real Estate Valuation

    Anyone involved in a real transaction can benefit from gaining a basic understanding of the different methods of real estate valuation.
  9. Personal Finance

    10 Things to Know About 1031 Exchanges

    Real estate swaps grow popular, but traps are many. Beware new rules on vacation homes.
  10. Retirement

    Marriage Vs. Common Law: What It Means Financially

    The number of unmarried couples is on the rise, but your relationship may or may not be given the same benefits as married couples.
RELATED FAQS
  1. How will my ex husbands bankruptcy affect the home mortgage in our names?

    My ex and I have both our names on our mortgage loan. We were never married. He is about to file bankruptcy and I'm wondering ... Read Answer >>
  2. What criteria does a property need to meet to be considered an 'investment grade' ...

    Learn what it takes for institutional investors to consider a property "investment grade," such as real estate investment ... Read Answer >>
  3. What do states do with unclaimed property?

    Understand what unclaimed property is and what types of property can be considered abandoned or unclaimed. Learn what states ... Read Answer >>
  4. How are capitalism and private property related?

    Read about the relationship between capitalism and private property rights, and learn why voluntary trade would collapse ... Read Answer >>
  5. How is Net Operating Income (NOI) used in real estate?

    Find out more about net operating income, what it measures and how it is used to analyze a real estate property's return. Read Answer >>
  6. What is the difference between real estate and real property?

    Understand how real estate is legally different from real property and the implications of that difference for each property ... Read Answer >>
Hot Definitions
  1. GBP

    The abbreviation for the British pound sterling, the official currency of the United Kingdom, the British Overseas Territories ...
  2. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  3. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  4. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  5. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  6. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
Trading Center