Real property (real estate) or personal property (money, jewelry, art, stocks, bonds, etc.) given by one spouse to the other spouse during marriage is generally presumed to be a gift, and is the receiving spouse’s separate property. Such a gift includes all income and property from the gifted property—such as stock splits resulting in new shares of stock, and stock dividends paid. Because such transfers of property are separate property owned by the receiving spouse, the spouse who gave or gifted the property during the marriage generally cannot recover it or seek a credit or offset for it against the marital or community property.

But laws on spousal gifts during marriage vary from state to state, and especially with gifts that are substantial in value in relation to the income and assets of the spouses. And in some states the character of property as (1) separate property or (2) community or marital property can be permanently changed if there was a transmutation of the property by written agreement of the parties—an agreement in which the property was transmuted from community property to separate property, for example. A transmutation of real property may have to be recorded in the county records to be effective.

Laws regarding the characterization of property given by one spouse to the other spouse during marriage, and any transmutation of the property, are generally located in a state’s statutes, and often in the family or domestic relations code.

In Wisconsin, which is not a community property state but rather a marital property state, property acquired during the marriage is generally considered marital property, regardless of how it is titled. Gifts from one spouse to another during the marriage are typically presumed to be marital property unless there is clear and convincing evidence that the gift was intended to be the separate property of the receiving spouse. This includes income and property derived from such gifts. However, spouses can change the character of the property from marital to separate through a process called transmutation. Transmutation requires a clear and affirmative action that demonstrates the intent to change the nature of the property, such as a written agreement. It is important to note that substantial gifts might be scrutinized differently, and the intent behind the gift will be crucial in determining its character. Additionally, for real property, any transmutation agreement may need to be recorded with the county to be effective. Wisconsin statutes, particularly those related to family or domestic relations, govern these matters and any disputes would be resolved according to these laws.