Now includes future property & future spouses Spouses or future spouses can partition or exchange existing or future CP Exchanges don’t have to be equal Chiles v. Chiles Legislature can’t change character Clause 3 ‘80 Requirements: Spouses & in writing (no partition or exchange req’d) Trial perk for spouses !!! Applies: Can agree that income or property from SP remains SP of that spouse Doesn’t Apply Can’t agree one spouse’s salary will be his SP & the others property will be their SP May only agree to income from SP being SP (bc earnings are CP) Can only agree (Must partition or exchange to do this) Can’t do it as future spouses But future spouses can accomplish it w/ a or partition exchange Strict Interpretation Spouses can agree that income from property left to W by her grandmother be SP Clause 4 Wyly v. Commissioner ’80 Rule: Income follows a gift bw spouses w/ gifts Wyly EX: Spouse gifts rental house to W W puts rent in her hold as her SP forever.” “to private bank account. It’s income & income is CP. House is SP. In the IRS comm’r said all interest retained must be reported. Thus, interest Wyly, from rental property gifted to a spouse, which is CP, effectively makes the gift not a gift. The was included in the 1980 Constitution: Wyly Amendment one spouse “If makes a gift of property to the other that gift of property is presumed to include all the income or property which might arise from that gift” Clause 5 McKnight v. McKnight; Hilley v. Hilley ’87 Rule: Can set up JTWROS w/ CP EX: CP will become property of my SS on my death Requirements: Spouses & in writing Clause 6 Kellate v. Trice ’99 Rule: Can change character of SP into CP Requirements: Spouses & in writing BoP shifted to opponent 1987: SP
Now includes future property & future spouses Spouses or future spouses can partition or exchange existing or future CP Exchanges don’t have to be equal Chiles v. Chiles Legislature can’t change character Clause 3 ‘80 Requirements: Spouses & in writing (no partition or exchange req’d) perk for spouses !!! Applies: Can agree that income or property from SP remains SP of that spouse Doesn’t Apply Can’t agree one spouse’s salary will be his SP & the others property will be their SP May only agree to income from SP being SP (bc earnings are CP) Can only agree (Must partition or exchange to do this) Can’t do it as future spouses But future spouses can accomplish it w/ a partition or exchange Strict Interpretation Spouses can agree that income from property left to W by her grandmother be SP Clause 4 ’80 Wyly v. Commissioner Rule: Income follows a gift bw spouses Wyly w/ gifts EX: Spouse gifts rental house to W “to hold as her SP forever.” W puts rent in her private bank account. It’s income & income is CP. House is SP. In Wyly, the IRS comm’r said all interest retained must be reported. Thus, interest from rental property gifted to a spouse, which is CP, effectively makes the gift not a gift. The Wyly Amendment was included in the 1980 Constitution: “If one spouse makes a gift of property to the other that gift of property is presumed to include all the income or property which might arise from that gift” Clause 5 ’87 McKnight v. McKnight; Hilley v. Hilley Rule: Can set up JTWROS w/ CP EX: CP will become property of my SS on my death Requirements: Spouses & in writing Clause 6 ’99 Kellate v. Trice Rule: Can change character of SP into CP Requirements: Spouses & in writing 1987: BoP shifted to opponent SP Trial