What Qualifies as Separate Property
- Assets owned before the marriage
- Gifts received by one spouse during the marriage
- Inheritances received by one spouse
- Property named as separate in a prenuptial or postnuptial agreement
- Any income or growth on separate property, if properly maintained
The Commingling Risk
The most common way separate property loses its protected status is through commingling. Depositing an inheritance into a joint bank account is one example. Using community funds to improve separate property is another. Arizona courts may then treat the mixed assets as community property.
To protect separate property, keep it in separate accounts. Save records showing its source. Avoid mixing it with marital funds. Your estate plan should clearly identify which assets are separate and which are community.