Currently, nine states allow married couples to vest real estate as community property. Interests owned in community property function much like partnership interests, in that each spouse’s real property acquisitions belong legally to the marriage rather than the individual. Community property law is complex and state-specific, meaning its characteristics vary from state to state.
Owners of real property in Wisconsin can hold title in one of three ways: as tenants in common, joint tenants, or, if spouses, as community property (known in Wisconsin as marital property).
Wisconsin’s Uniform Marital Property Act (chapter 766 of Wisconsin Statutes) was adopted in 1986, and follows many community property principles.
All property of spouses in Wisconsin is presumed to be marital property, shared equally by both spouses. Each spouse automatically owns a one-half share of all property acquired by the marriage, regardless of which spouse actually acquires property. In other words, “the natural inclination to think in terms of ‘his’ and ‘hers’ must be discarded with regard to community property” in favor of the marital unit [1].
Wisconsin property is presumed to vest as marital property by spouses unless there is a written agreement proving otherwise (these are called marital property agreements), or enough proof exists to show that the property was owned by either spouse in an individual capacity before the marriage, the property was a personal gift received by either spouse at any point during the marriage, or the property was an inheritance left to either spouse [2].
Wisconsin also recognizes quasi-community property, also known as deferred marital property, for property acquired out-of-state that would otherwise have been categorized as community property if in Wisconsin [2].
The classification of Wisconsin marital property is unique in that it depends on the date of acquisition of the property in relation to the determination date. This date is the most recently occurring of the following: (1) the date of marriage, (2) the date of establishment of domicile by both spouses in Wisconsin, or (3) January 1, 1986, when the marital property regime was passed in Wisconsin [2].
If a property is conveyed to spouses by a deed predating the determination date, the couple holds title in either joint tenancy or tenancy in common, depending on the language of the granting clause. If the property is conveyed to spouses by a deed postdating the determination date, the property is marital property, even if the deed names one spouse as his/her sole and separate property[1].
Wisconsin also permits survivorship marital property. If a deed specifies “survivorship marital property” instead of “marital property,” or it post-dates the determination date and specifies that the spouses vest as joint tenants, the property is characterized as a survivorship marital property [1]. Wisconsin’s statutes state, “On the death of a spouse, the ownership rights of that spouse in the property vest solely in the surviving spouse by nontestamentary disposition at death” (Wis. Stat. § 766.60(5)(a)). In other words, the transfer of property to the surviving spouse is easy, but the individual cannot include the interest in the property in his/her will.
View Wisconsin Real Estate Deed Forms
Community/marital property law is complex and can have far-reaching implications. To prevent unexpected complications, contact an attorney with any questions.
Sources:
[1] IRM § 25.18.1. http://www.irs.gov/irm/part25/irm_25-018-001.html
[2] Sjoberg,Roy A., Esq. “Community Property in a Nutshell, With an Emphasis on theBadger State.” Sjoberg and Tebelius, Attorneys and Counselors at Law.Sjoberg & Tebelius, P.A.2015, Web. http://www.stlawfirm.com/Publications/Community-Property-In-a-Nutshell-With-an-Emphasis-On-the-Badger-State.shtml.