Nelson formula (In re Marriage of Nelson, 1986)Grants before & during marriageReal AAPL & META examples

RSU Division in California Divorce

Restricted Stock Units earned during a marriage are community property — but most grants span years, crossing the marriage start date, separation date, or both. The Nelson formula determines exactly how much of each grant belongs to the community.

Why RSUs are complicated in divorce

Unlike a salary, RSUs are granted on one date and vest (become yours) on a later date — often 1–4 years later. The stock is compensation for services performed over the entire grant-to-vest period. If that period overlaps with the marriage, the portion of shares that corresponds to the marriage period is community property.

The complication: most employees have multiple grants, each with different grant dates and vest dates. A grant from 2017 vesting in 2021 might be 17% community property. A grant from 2021 vesting in 2022 might be 100% community. The formula is the same — but the inputs produce very different results.

The key question is not when you received the stock

It is: how much of the earning period (grant date to vest date) fell within the marriage? That fraction is the community's share.

The Nelson Formula

Nelson formula (In re Marriage of Nelson, 177 Cal.App.3d 150 (1986))

Community Ratio = Overlap Days ÷ Total Grant-to-Vest Days

Overlap Days = (earlier of: Vest Date, Separation Date)

− (later of: Grant Date, Marriage Date)

Clamped to [0%, 100%]

This single formula handles all timing combinations. If the grant date is before the marriage, the marriage date becomes the overlap start. If the vest date is after separation, the separation date becomes the overlap end.

Nelson vs. Hug formula

California courts may apply either the Nelson formula (overlap of marriage with grant-to-vest period) or the Hug formula (ratio of marriage length to hire-date-to-vest length). Nelson is more common for RSUs; Hug is sometimes preferred for stock options with longer vesting periods. The Nelson formula generally produces higher community ratios and favors the non-employee spouse.

The Timing Scenarios

Every RSU grant falls into one of these timing categories relative to the marriage window. The diagram below shows how each scenario looks — and the resulting community ratio.

Alice

Apple (AAPL)

Software engineer

Marriage Window

Jan 1, 2021

to Dec 31, 2022

Bob

Meta (META)

Product manager

Separate period

Marriage window (community)

● grant date◆ vest date

↓ Marriage (DOM)

↓ Separation (DOS)

Bob · META

Pre-marriage grant, in-marriage vest

16.9%

Alice · AAPL

Pre-marriage grant, in-marriage vest

74.9%

Bob · META

In-marriage grant + vest

100%

Alice · AAPL

In-marriage grant + vest

100%

Alice · AAPL *

In-marriage grant, post-separation vest

35.9%

* Hypothetical example — not in the default calculator dataset

Pre-marriage grant, in-marriage vest

Partial community — only the overlap from marriage to vest counts

In-marriage grant, in-marriage vest

100% community — the entire earning period is within the marriage

Pre-marriage grant, post-separation vest

Partial community — only the marriage window counts out of the full period

In-marriage grant, post-separation vest

Partial community — overlap is grant date to separation date

Grant-by-Grant Walkthrough

Scenario 1Bob · META — Granted Dec 2017, vested Aug 2021

Pattern: Pre-marriage grant, in-marriage vest

Bob received this META grant more than 3 years before the marriage. Most of the earning period is separate property. Only the months from the wedding through the vest date count as community.

Identify the overlap

Grant date (DOG): Dec 15, 2017

Vest date (DOE): Aug 15, 2021

Marriage date (DOM): Jan 1, 2021

Separation date (DOS): Dec 31, 2022

Overlap start = later of (DOG, DOM) = Jan 1, 2021

Overlap end = earlier of (DOE, DOS) = Aug 15, 2021

Overlap = 226 days

226 days

Compute the community ratio

Total days (DOG → DOE): 1,339 days
Community ratio: 226 ÷ 1,339 = 16.9%

Because the grant was more than 3 years before the wedding, most of the earning period falls outside the marriage window.

≈ 16.9%

Calculate community proceeds

Net shares (after withholding)	119
Price at vest	$648.18
Total proceeds	$77,133
Community ratio	16.9%
Community proceeds	$13,036
Alice's share (50%)	$6,518
Bob's share (50%)	$6,518

$13,036 total · $6,518 each

Scenario 2Alice · AAPL — Granted Sep 2020, vested Oct 2021

Pattern: Pre-marriage grant, in-marriage vest (grant closer to wedding)

Same pattern as Scenario 1 — but Alice's grant was only 3 months before the wedding. The earning period barely extends into the pre-marital period, so most of it falls within the marriage.

Identify the overlap

Grant date (DOG): Sep 27, 2020

Vest date (DOE): Oct 15, 2021

Marriage date (DOM): Jan 1, 2021

Overlap start = later of (DOG, DOM) = Jan 1, 2021

Overlap end = earlier of (DOE, DOS) = Oct 15, 2021

Overlap = 287 days

287 days

Compute the community ratio

Total days (DOG → DOE): 383 days
Community ratio: 287 ÷ 383 = 74.9%

Same scenario as Scenario 1, but the grant was much closer to the marriage date — resulting in a much higher community ratio. Timing matters enormously.

≈ 74.9%

Calculate community proceeds

Net shares	76
Price at vest	$272.95
Total proceeds	$20,744
Community ratio	74.9%
Community proceeds	$15,537
Alice's share (50%)	$7,769
Bob's share (50%)	$7,769

$15,537 total · $7,769 each

Scenario 3Bob · META — Granted Mar 2021, vested Aug 2021 (fully in-marriage)

Pattern: In-marriage grant and vest → 100% community

This grant was awarded and vested entirely within the marriage. Every day of the earning period falls within the community window, so the ratio is 100%.

Community ratio

Grant date: Mar 22, 2021 (during marriage ✓)

Vest date: Aug 15, 2021 (during marriage ✓)

Overlap (Mar 22 → Aug 15) = Total (Mar 22 → Aug 15) = 146 days

Ratio: 146 ÷ 146 = 100%

100%

Community proceeds

Net shares	85
Price at vest	$648.18
Total proceeds	$55,095
Community ratio	100%
Community proceeds	$55,095
Alice's share (50%)	$27,548
Bob's share (50%)	$27,548

$55,095 total · $27,548 each

Scenario 4Alice · AAPL — Granted Sep 2021, vested Apr 2022 (fully in-marriage)

Pattern: In-marriage grant and vest → 100% community

Same result as Scenario 3. Grant date Sep 26, 2021 and vest date Apr 15, 2022 are both within the marriage window (Jan 1, 2021 – Dec 31, 2022).

Community ratio + proceeds

Grant date	Sep 26, 2021 (in-marriage)
Vest date	Apr 15, 2022 (in-marriage)
Community ratio	100%
Net shares	57
Price at vest	$272.95
Total proceeds	$15,558
Community proceeds	$15,558
Alice's share (50%)	$7,779
Bob's share (50%)	$7,779

$15,558 total · $7,779 each

Scenario 5 — HypotheticalAlice · AAPL — Granted Jun 2022, vested Jan 2024 (vest after separation)

Pattern: In-marriage grant, post-separation vest — partial community

This is the "limbo grant" — awarded during the marriage but vesting after the separation date. Alice earned some of this grant during the marriage and some after. Only the portion from the grant date to the separation date is community property.

Identify the overlap

Grant date (DOG): Jun 1, 2022 ← during marriage

Vest date (DOE): Jan 15, 2024 ← after separation

Separation date (DOS): Dec 31, 2022

Overlap start = later of (DOG, DOM) = Jun 1, 2022

Overlap end = earlier of (DOE, DOS) = Dec 31, 2022

Overlap = 213 days

213 days

Compute the community ratio

Total days (DOG → DOE): 593 days
Community ratio: 213 ÷ 593 = 35.9%

Even though the grant was awarded during the marriage, 64% of the vesting period falls after the separation date — that portion is Alice's separate property.

≈ 35.9%

Community proceeds (hypothetical)

Net shares (hypothetical)	65
Price at vest (assumed)	$272.95
Total proceeds	$17,742
Community ratio	35.9%
Community proceeds	$6,369
Alice's share (50%)	$3,185
Bob's share (50%)	$3,185

$6,369 total · $3,185 each

Summary & Equalization Payment

Using the four real grants (Scenarios 1–4), here is the combined community RSU pool and how it is distributed.

Grant	Proceeds	Ratio	Community
Bob · META (Dec 2017)	$77,133	16.9%	$13,036
Bob · META (Mar 2021)	$55,095	100%	$55,095
Alice · AAPL (Sep 2020)	$20,744	74.9%	$15,537
Alice · AAPL (Sep 2021)	$15,558	100%	$15,558
Total	$168,530		$99,226

Equalization payment

Each party is entitled to 50% of the total community RSU pool. But each party physically holds the proceeds from their own RSU grants. The equalization payment transfers the difference.

Total community RSU pool$99,226

Each party entitled to (÷ 2)$49,613

Alice holds (AAPL community proceeds)$31,095

Bob holds (META community proceeds)$68,131

Bob owes Alice (Bob holds $68,131 − entitled to $49,613)$18,518

This $18,518 equalization payment is typically handled at the time of the divorce settlement, either as a direct payment or offset against other asset division.

Key Takeaways

Grant date timing drives the community ratio

Two grants from the same company with the same vest date can have wildly different community ratios depending on when each was granted. Bob's 2017 META grant is only 16.9% community; his 2021 META grant is 100% — same vest date, different story.

Vesting after separation does not make shares fully separate

A grant awarded during the marriage that vests after the separation date is still partially community property. The community fraction covers from the grant date to the separation date.

Each spouse's RSU pool is calculated independently

Alice's AAPL grants and Bob's META grants each have their own community ratios. The equalization payment then squares the books — whoever holds more than their 50% entitlement pays the difference.

Get the exact dates from grant documents

The calculation is sensitive to exact grant dates and vest dates. Use the actual dates from the employee's grant notice, not approximations. A one-month difference in grant date can move the ratio by several percentage points.

Nelson vs. Hug Formula

Nelson Formula

Overlap of marriage window with the grant-to-vest period. Treats each RSU grant as compensation for services from grant date to vest date.

Preferred for: RSUs. Produces higher community ratios. Favors the non-employee spouse.

Hug Formula

Ratio of marriage length to hire-date-to-vest length. Treats the grant as compensation for all services from the hire date through vesting.

Preferred for: Stock options with long tenure. Produces smaller community ratios. Favors the employee spouse.

Which formula applies depends on the facts of each case and the court's discretion. Our calculator supports both — use the formula selector in the RSU calculator to compare.

Calculate your RSU community property

Enter your grant dates, vest dates, and prices. The calculator applies the Nelson or Hug formula automatically, computes every grant's community ratio, and shows the equalization payment.

Open RSU Calculator →

Watch the video explainer

Plain-English walkthrough of how California divides property in a divorce.

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Your Fair Half — the book

The complete guide to knowing what you're owed before you sign anything.

For informational purposes only. Not legal advice. Consult a licensed California family law attorney.