When it comes down to dividing property in a divorce, most states are “equitable distribution” states, while a handful of states are “community property states.” Like California and Nevada, Texas is a community property state.
What does community property mean exactly? Generally, it means that all property acquired by both spouses during the marriage belongs to both of them, regardless of which spouse earned the income or whose name is on the title. In other words, in Texas, spouses own marital property jointly.
For example, if “Rob” paid cash for a $60,000 Ford pickup during his marriage to “Anne” and the couple filed for divorce a year later, Anne would have an interest in the truck, even if it was only in Rob’s name.
Separate Property Isn’t Divided
While community property is subject to a split in a divorce, separate property is generally not divided in a divorce. So, what counts as separate property? It includes assets and property owned by one spouse prior to the marriage, gifts received by one spouse during the marriage, inheritances received by one spouse during the marriage, and personal injury awards received by one spouse during the marriage.
In some cases, if separate property is commingled with marital assets; for example, if an inheritance was deposited into a joint bank account and used for household bills, then it can be a part of the marital estate. Or, if there is a prenuptial or postnuptial agreement that says separate property shall remain separate, it will not be counted in the marital estate.
How is Community Property Divided?
When couples divorce in Texas, they have the ability to reach a property division agreement on their own and with the help of their respective attorneys. If a couple cannot agree, a judge will have to decide for them based on what the judge deems to be “just and right” considering the circumstances. When deciding what is “equitable” or fair, the judge may consider:
- Marital misconduct, such as adultery
- Wasteful dissipation of marital assets (squandering marital assets)
- The disparity in the spouses’ earning power
- Each spouse’s health
- Each spouse’s education and earning capacity
- Which spouse gets custody of the children
We hope you found this information useful. If you need to speak with a member of our legal team, contact Goline & Roland Law Firm, PLLC.