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What is the Difference between Community and Separate Property?

During a divorce in Texas, all property is designated either community or separate property all depending on when and how it was acquired.

That property acquired prior to marriage is considered separate property, and property acquired after the marriage is community property in essence. Even if you liquidated your separate property while married, the proceeds remain separate.

Community property can be characterized as:

  • Property purchased with income earned during the marriage
  • Dividends, interest, and capital gain earned on community property
  • Income earned by either spouse during the marriage
  • Dividends and interest earned on either spouse’s separate property during the marriage

On the other hand, separate property includes:

  • Any gift acquired by gift or inheritance
  • Income earned by either spouse prior to the marriage
  • Personal injury damages for an injury sustained even while married
  • Capital gain on separate property such as appreciated stock

Some property can even be both separate and community. If, for example, you bought a home while married and used the proceeds from the sale of separate property to pay the down payment, that percentage of your home would be your separate property. On the other hand, if you make mortgage payments from the income earned while married, part of the home would be considered community property.

When you need help with asset division, you should speak with the Law Office of Brett H. Pritchard and our Killeen divorce lawyer can advise you as to how best to proceed while protecting your property.

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