We are sometimes asked whether Maryland is a community property state. It is not. Only Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin are. Maryland is an equitable property state.
In equitable property states such as Maryland, property acquired during the marriage belongs to the spouse in whose name the property is titled–but that does not mean he/she gets to keep it in a divorce. In the event of a divorce, the Maryland Court uses a three part test to determine whether to equitably divide the value of the separately titled property.
- First the Court will determine ownership of the property.
- Then it will determine if it is marital property, regardless of how titled. Property acquired during the marriage (up until the date of divorce) is marital property unless it is gifted to one party or the parties agree it will be separate property.
- As the final step, the Court will make whatever monetary award, including in some cases transferring ownership, it deems appropriate. There are 11 separate factors the Court considers in deciding what award, if any, to make.
A note about debt: In community property states, debt acquired during the marriage is also community property, so each party is equally liable for all of the debt. In Maryland the Court cannot divide debt except for debt used to acquire tangible property. However, it can take debt into consideration when making a marital award.