If you are going through a divorce in Texas, you need to understand the difference between community and separate property. It is advisable to hire a Gatesville divorce lawyer to protect your legal rights and ensure that the property is divided fairly.
What is Community Property in a Texas Divorce?
Texas is a community property state when it comes to dividing property between spouses in a divorce (Texas Family Code § 3.002). In other words, it means that all assets and liabilities (debts) acquired by both spouses during the marriage will be considered community property, which is subject to equal division in the event of divorce.
In fact, if a home or any other asset has the status of community property, it will be divided between the spouses regardless of who paid to acquire the asset or whose name appears on the title.
All that matters is the date when the spouses acquired the asset. For example, if a home was purchased during the marriage, it would most likely be considered community property unless it was inherited or gifted.
Let’s review some of the most common examples of community property in a Texas divorce:
Houses and other real property purchased by either spouse during the marriage;
Employment income, including salaries, wages, bonuses, and other payments;
Automobiles and vehicles purchased by either spouse during the marriage;
Contributions to 401k, pension, and retirement accounts made by either spouse during the marriage; and
Both spouses’ checking and savings accounts.
Contact a knowledgeable lawyer to help you determine what constitutes community and separate property in your particular divorce case.
What is Separate Property in a Texas Divorce?
Everything the spouses acquire during the marriage is considered community property unless either spouse can prove some of the assets are separate property.
Separate property can be broken down into four categories:
Assets and real property owned before the marriage;
Property acquired before or during the marriage as a gift;
Property inherited before or during the marriage; and
Personal injury settlements.
Common examples of separate property in a Texas divorce include:
A house purchased by one spouse before the marriage
Individual contributions made to a spouse’s retirement account before the marriage
Inheritance received by one spouse
Note: If a house purchased before the marriage is classified as separate property, but the owner spouse made mortgage payments using community funds during the marriage, the other spouse may request reimbursement for the money spent on mortgage payments.
The Presumption of Community Property in Texas
Under Texas law, all property owned by the spouses at the time of filing for divorce is presumed to be community property. However, a spouse can overcome the presumption by demonstrating clear and convincing evidence to prove that a piece of property is separate.
The presumption of community property may complicate the property division process during a divorce case. When either spouse wants to overcome the presumption, that spouse has the burden of proof to prove that the assets are separate property.
If you want to prove that the assets classified as community property are actually separate property, you need to consult with an attorney to help you gather the necessary evidence to establish when and how the assets in question were acquired.
How Do Texas Courts Divide Community Property in a Divorce?
Contrary to popular belief, Texas courts do not divide community property equally in a 50/50 split all the time. The judge will consider a variety of factors to determine a just and right division of property in a divorce.
When the divorcing spouses reach an agreement on the division of property, the court usually approves the agreement to finalize the divorce. Generally, the spouse who is awarded property takes on the debt related to that piece of property (e.g., the family house with the mortgage).
In some cases, the court may opt for an unequal split between the spouses where one of the spouses is awarded a larger share of the community property.
Texas courts may award community property unequally if the division is just and right. When determining what constitutes a just and right division, the judge will consider the following factors:
The needs of the children, if any
Each spouse’s needs and financial resources
Each spouse’s income and earning capacity
The age of each spouse
Each spouse’s physical and mental health
The education of each spouse
Which spouse has primary custody
Whether either spouse is guilty of marital misconduct
How Do Texas Courts Divide Debts in a Divorce?
Both spouses are responsible for the marital debts incurred by either spouse during the marriage. Thus, even if it was your spouse who racked up debt during the marriage, you may still be responsible for all the debt incurred between the date of marriage and the date of divorce.
Common debts and liabilities that are divided between spouses in a Texas divorce include but are not limited to:
Credit card debt
However, while both spouses are usually responsible for the marital debts incurred during the marriage, Texas courts may not divide the debts equally. Instead, courts strive to divide assets and debts in a just and right manner. (learn more about the overall cost of your Texas divorce)
Call a Gatesville Divorce Lawyer to Get a Case Review
Dividing property is usually one of the most contentious and heavily litigated issues in a divorce. If you and your spouse cannot reach an agreement on what constitutes community and separate property, it is advisable to work with an experienced attorney.
Our Gatesville divorce lawyers at The Law Office of Brett H. Pritchard will represent your rights and interests during your divorce case to ensure that your property is divided in a fair manner. Call 254-501-4040 or contact us online to schedule a case review.