Additional Rules for Community Property States
In community property states, as in common law states, you're on the hook for any debts in your name or that you cosign for. Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin are community property states.
If they've taken debt out in their name only, you won't be responsible for paying it back. If you take on joint debt with your spouse, however, then you may be liable if they're not able to keep up with their part of the repayment.
Like credit, debt is also tied to your individual credit history. So, whether you're married or unmarried, you aren't automatically responsible for your partner's debts. Additionally, any bankruptcies that you or your partner experienced in the past will generally not impact the other person's credit reports or scores.
Generally speaking, you can't be pursued for your spouse's debt unless you live in one of the nine community property states (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin) or you've co-signed or co-borrowed on a loan or you have a joint account.
You can protect yourself from your spouse's debt by signing a prenuptial agreement before you get married and avoid taking out joint credit. It's especially important to protect equity in your home during a divorce to ensure you get your fair share, since this is likely the largest asset you have.
The relevant information to focus on here is that California is a community property state, which means that legally married couples jointly own everything – including debt. As a result, it is possible for a creditor to garnish a spouse's bank account if their spouse owes a debt.
In general, spouses are not responsible for each other's debts. However, there are certain situations where a spouse may become liable for their partner's debt. This occurs when the spouse willingly agrees to be personally responsible for the debt, such as by co-signing a loan or jointly opening a credit account.
Unmarried couples do not go through divorce like married couples do if they split. As long as unmarried partners can agree on how to divvy up any assets, there's generally no need for lawyers or courts.
— "The First Measured Century: Social disruptions". PBS. As of December 2023, cohabitation of unmarried couples remains illegal in two states (Mississippi and North Carolina), while as of 2023 fornication remains illegal in two states (Georgia and South Carolina).
Debts. Unlike marriage, living together does not make you responsible for your partner's debts. Should your partner declare bankruptcy or face other debt problems, you won't lose your property as long as you've kept it separate.
Financial infidelity is when couples with combined finances lie to each other about money. Examples of financial infidelity can include hiding existing debts, excessive expenditures without notifying the other partner, and lying about the use of money.
If the firm cannot pay, the creditors are likely to ask the individual partners to pay. Partners have joint liability for the firm's debts. This means that each partner is liable for the whole balance of the firm's debts. However, any payments made towards a firm's debt will reduce the balance owed by each partner.
Am I responsible for my husband or wife's debt? Being married to someone doesn't mean you inherit their debts. If you don't have joint finances, like a mortgage or joint bank account, then you can't be made liable. The same goes if you change your surname when you get married.
Medical debt and hospital bills don't simply go away after death. In most states, they take priority in the probate process, meaning they usually are paid first, by selling off assets if need be.
If your spouse passes away, but you didn't sign the promissory note or mortgage for the home, federal law clears the way for you to take over the existing mortgage on the inherited property more easily.
In a legal separation, you stay married but the court divides your property and debts and makes orders about financial support. If you have children together, you can also ask for orders about their care and support. You can ask the judge to make orders about: The division of your property.
Can a Girlfriend Ask for Alimony? It's called “palimony,” and, yes, it's a real thing. However, it's also really unusual. Not all states allow a person who wasn't married to their ex to request financial support, especially when the couple does not meet the standard for a common-law marriage.
Unlike married couples, common-law couples don't need a court decision to make their separation official. You can settle all the issues that arise when you break up without going to court. But sometimes it's a good idea to have a lawyer or notary help you.
You are generally not responsible for your spouse's credit card debt unless you are a co-signer for the card or you're a joint cardholder on the account.
In a general partnership all the partners are personally liable for the partnership debts. In a limited partnership, limited partners are not liable for the partnership's debts beyond the funds they contribute to the partnership.
If you live in a community property state, you probably will be responsible for debts accumulated by your spouse during the marriage. (These states are California, Texas, Arizona, New Mexico, Nevada, Washington, Idaho, Wisconsin, and Louisiana, while Alaska, South Dakota, and Tennessee make it optional.)
Bank accounts solely for government benefits
Federal law ensures that creditors cannot touch certain federal benefits, such as Social Security funds and veterans' benefits. If you're receiving these benefits, they would be exempt from garnishment.
Couples in community property states can sign pre- or postnuptial agreements to treat debts and income separately. However, a contract between you and your spouse only won't affect whether a creditor can pursue you for debt (they still can). It really only impacts property and debt division upon divorce.
What States Prohibit Bank Garnishment? Bank garnishment is legal in all 50 states. However, four states prohibit wage garnishment for consumer debts. According to Debt.org, those states are Texas, South Carolina, Pennsylvania, and North Carolina.