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What Are Watts Charges and Epstein Credits?

Posted by Michael Geller | Mar 01, 2023 | 0 Comments

During divorce proceedings in California, you may hear some odd terminology and shorthand references. For example, during your divorce, you may hear references to “Epstein credits” and “Watts charges” and wonder, “what are these lawyers talking about?” Gain insight into these topics below.

Epstein Credit Explained

In California divorce proceedings, an Epstein credit is essentially the right to be reimbursed by your spouse for one-half of separate property money used after the date of separation to help pay down any community debt. For example, if one spouse makes a mortgage payment after separation, the courts may issue a reimbursement for the other spouse's share of the expense.

Watts Charge Explained

In California divorce proceedings, a Watts charge is an obligation to your spouse for one-half of the reasonable value for the exclusive use of a community asset after the date of separation. For example, if your spouse continued to live in a previously shared residence or drive a previously-shared automobile after separating from you, then a Watts charge may come into play. In this scenario, the spouse not using the real property can make a charge against the other spouse for one half of the community asset's use.

Filing a Watts charge requires providing prior written notice to the other party of the intent to seek a credit for post-separation use of community assets. You should give notice to your spouse of the intent of a Watts charge as soon as possible in litigation. Failing to provide timely notice of seeking a Watts charge can lead to a court to determine that the Watts charge claim is not within the reasonable expectations of the other party.

Watts Charges and Epstein Credits In the Same Divorce Case

There may be instances where Watts charges and Epstein credits are asserted in the same divorce case. In this scenario, it is important to note that these charges and credits will likely offset one another partially or completely. For example, if a spouse has to pay $3,000 per month in Watts charges in order to live in a shared home, but the mortgage payment on the home is also $3,000 per month, the spouse will likely not owe anything.

If one is more or less than the other, a partial offset could result. It is also important to note that one spouse may get both Epstein credits and Watts charges. For example, a husband may get an Epstein credit reimbursement for making a mortgage payment on a home and a Watts charge when their wife is living exclusively in the home on which the husband made payment.

Have Questions About Watts Charges and Epstein Credits in Contra Costa County? Contact The Geller Firm Today

If you have questions or concerns about Epstein credits and/or Watts charges during your divorce proceedings, consider contacting The Geller Firm. Our team of experienced and respected Lafayette divorce attorneys are here to help during this difficult time. We are located in the San Francisco Bay Area and are proud to provide legal services in Walnut Creek, Lafayette, Orinda, Moraga, and Contra Costa County, along with San Francisco, San Jose, Oakland, and Pleasanton. Our legal team is available for virtual and in-person consultations. Contact us today to schedule an appointment.

About the Author

Michael Geller

Michael Geller grew up in San Francisco, CA. He attended the University of Southern California for his undergraduate studies, the City University of New York for his medical training, and Santa Clara University School of Law for his legal education.


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