Texas is a community property state. Both spouses own all property acquired by one or both of them during their marriage. Texas law presumes that any property acquired during the marriage will be community property. Some of that property, however, will be excluded from this definition.
Kinds of Marital Property in Texas
Texas recognizes two kinds of property in its matrimonial laws. First, as noted above, the community property is owned equally by the two spouses. Usually, anything acquired during the marriage will fall into this category. On the other hand, property solely owned by one spouse is called separate property and may have been obtained before or during the marriage. To continue as separate property, the property must be identifiable as separate from the marital estate.
What is Separate Property in Texas?
Separate property is that property owned by only one spouse. Separate property may include either property owned by that spouse before the marriage or acquired by gift, inheritance, or recovery for certain losses by that spouse. Separate property is not subject to the rules governing community property division in the marital estate in a divorce action.
How Does This Apply to Particular Property?
Suppose a spouse received a particular property by gift or inheritance during the marriage. In that case, the receiving spouse must keep records showing that the gift or inheritance was intended to be separate property. The owning spouse should also be careful not to commingle the property with marital property or allow any confusion about ownership to develop. Owners should also be aware that any income deriving from a separate property in Texas is community property, not separate property.
What is Mixed Property?
Sometimes, it can be challenging to define property as separate or marital. For example, if one spouse began collecting comic books before the marriage but continued to collect while married, they can become marital property depending on the parties' intent and the funds used for the post-marriage purchases.
Can the Classification of Property Change During the Marriage?
There are many ways that separate property can become community property. A separate property bank or brokerage account, for example, can become community property through the addition of community-owned funds to it. When a spouse withdraws funds from such an account, the law presumes that the community funds are removed first. Still, this is creating confusion where none need have been. Titling and handling of property in the marriage can change property classification regardless of the parties’ original intent.
How to Keep Property Separate
Texas operates under a rebuttable presumption that anything acquired during the marriage is community property. To maintain the status of separate property, the spouse claiming sole ownership has to be able to prove by clear and convincing evidence:
When the property was acquired
That it was acquired by inheritance, gift, or allowable recovery for injury
That no community funds were used to purchase the property
That no community funds were used to maintain the property
Note that the name on the property title will not control whether the property is community or separate.
What about Family Heirlooms?
With personal property like jewelry or fine china, the main issues are intent and recordkeeping. So long as the assets, whenever and however acquired, were clearly identified as separate property, were continuously maintained as separate property, and no community funds were spent on them, the assets should continue to be separate property. A gift from one spouse to another, such as an engagement ring, is generally deemed separate property.