When a marriage ends in Texas, dividing property and assets is a big part of the divorce process. While mutual agreement on property division simplifies the process, it can be a significant point of contention in many cases. As Texas divorce lawyers dedicated to representing individuals through this difficult time, a common question we get is, “How is property divided in a Texas divorce?” Below, we discuss what to know about property division in a Texas divorce.
What Property Is Divided During a Texas Divorce?
Texas is a community property state. Under this system, property, assets, or debts acquired by either spouse during the marriage are generally considered equally owned by both spouses. Community property must be divided between the spouses.
Examples of community property may include:
- Financial accounts. Any checking or savings account balances may be considered community property if the money contributed to the accounts was acquired during marriage.
- Income. All income earned by either spouse during the marriage is generally considered community property. Income may include wages, bonuses, tips, overtime, and other earnings.
- Real estate. Real estate, including the marital home, purchased by either spouse during the marriage typically falls under community property.
- Personal property. Any assets purchased by either spouse during the marriage are typically community property. Purchased assets may include a wide range of items, including vehicles, furniture, electronics, jewelry, and other personal property.
- Retirement accounts. Any contributions to retirement accounts during the marriage are typically considered community property.
- Debts. Debts incurred during the marriage, whether in one spouse’s name or both names, are generally considered community debts for which both spouses are responsible. Examples of marital debt may include a mortgage, auto loans, and credit card debt.
It is important to understand that it makes no difference who paid for something, whose name is on the title of a home or vehicle, or who opened and contributed to a financial account. If it was purchased or acquired during the marriage, it is most likely community property.
However, there are some exceptions to community property. Some property falls under the category of separate property. Our Texas divorce attorneys explain separate property below.
What Are the Exceptions to Community Property in Texas?
Any property exempt from community property is called separate property. Separate property is not divided in a divorce and remains with the original owner. Examples of separate property in a Texas divorce include:
- Property acquired before marriage. In Texas, any property one spouse owned or acquired before marriage is considered separate property. Even after getting married, anything belonging to one spouse before the marriage remains their own. It is not subject to division in a divorce.
- Inheritances. An inheritance one spouse receives during the marriage by devise or descent is considered separate property.
- Gifts. Any gifts given to one spouse during the marriage, whether from the other spouse or someone else, are considered separate property. For example, a car given to one spouse by their parents is categorized as separate property.
- Recovery for personal injuries. A personal injury settlement or award, except for recovery for loss of earning capacity, received by one spouse during the marriage is considered their separate property.
Any asset proven to be separate property by clear and convincing evidence or by agreement of both spouses is not subject to division in divorce.
We recommend working with a Texas divorce attorney during the divorce process. The property division process can be stressful and complicated. This is especially true when there are questions or disagreements about what is community property and what is separate property.
An experienced attorney can help you identify tangible and intangible assets, categorize them, and value them. An attorney can also help fight for your best interests in court if you cannot come to an agreement about property division with your spouse.
How Is Community Property Divided in a Texas Divorce?
According to Texas law, community property should be divided between the spouses “just and right.” There is a common misconception that community property will be divided equally down the middle. While many cases may result in a 50-50 division of property, it is important to understand that a “just and right” division does not necessarily mean a 50-50 split.
Unless both spouses agree on property division, the division of community property is up to the court’s discretion. The court may order an uneven division of property, depending on the unique factors of the case.
The court will consider various factors specific to the case before deciding about how to divide community property. Examples of these factors may include, but are not limited to, the following:
- Each spouse’s earning capacity
- Each spouse’s financial obligations and needs
- Child custody considerations
- Value of each spouse’s separate property
- Grounds for divorce
The court may evaluate any factors it considers relevant. On our blog, you can learn more about factors that may affect property division in a Texas divorce.
At the end of the divorce case, the judge will divide marital property by signing a Final Decree of Divorce, or a court order ending the marriage. The Final Decree of Divorce will establish the following about property division:
- Specify the separate property of each spouse
- Divide and list the community property of each spouse
- Divide and list the debts that each spouse must pay
Schedule a Consultation With Our Texas Divorce Attorneys
Are you facing a divorce in Texas? We recommend working with an experienced Texas divorce lawyer. An attorney can help to protect your rights and advocate for your best interests. At Warren & Migliaccio, we strive to achieve the best possible results for our clients during this difficult time in their lives.
Contact our Texas divorce attorneys to schedule a consultation about your unique situation. We are here to answer your legal questions and discuss your case. We can also discuss your best legal options for protecting your assets and securing financial stability in the next chapter of your life. Call our office or contact us online to schedule your consultation today.