Married couples essentially share what type of income in community property states?

In community property states, the principle is that all income earned during the marriage is considered community property, meaning that it is owned equally by both spouses, regardless of who actually earned it. This means that any wages, salaries, or other earnings generated during the marriage are automatically shared, thus giving each spouse a claim to half of that income for purposes of taxation and property ownership.

This framework is foundational in community property law, which aims to simplify the economic relationship between spouses by treating all earnings and assets accrued during the marriage as jointly held. As a result, even if one spouse is the sole earner, both spouses share in that income due to the community property laws. This is distinct from separate property, which is owned by one spouse individually.

In contrast, the other options misinterpret the sharing of income in community property states. For example, limiting sharing to the higher earner's income does not account for the collective nature of earnings in these jurisdictions. Assuming that only income from investments or from businesses owned individually qualifies also fails to recognize the comprehensive nature of community property laws that encompass all earnings made during the marriage.