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How Is Property Divided in a Texas Divorce?

You don't have to earn an enormous amount of money for property division to become complicated in a divorce, but when complex assets are involved, the risk of an unfair settlement may be higher.

That is why accurate categorization and valuation of property are so important.

What is community property?

Unless a prenuptial or postnuptial agreement states otherwise, the assets and debts a couple acquires during the course of a marriage are typically regarded as community property under Texas law. Community property is divisible between the spouses when they divorce.

Community property may also include the increase in value of an item of property that was owned by one spouse prior to the marriage. For example, if one spouse's retirement plan increases in value during the marriage, then the increase in value could be included as community property, while the value of the plan on the marriage date may be excluded from division.

Depending on the facts of the case, the following assets may be subject to property division in a Texas divorce:

  • The family home and other real estate
  • Business assets
  • Bank accounts
  • Intellectual property
  • Vehicles
  • Retirement plan proceeds
  • Insurance proceeds
  • Stocks and bonds

What is separate property?

The Texas Family Code breaks separate property into three general categories:

  1. Property that one spouse owned or claimed before the marriage
  2. Gifts and inheritances acquired by one spouse during the marriage
  3. Compensation that one spouse recovered for personal injury, excluding compensation for loss of earning capacity during the marriage.

Separate property is not necessarily subject to property division. However, clear and convincing evidence is needed to establish particular assets as separate property. For example, it would be necessary to prove the value of a retirement plan on the marriage date in order for that amount to be excluded from division.

Equitable distribution of assets does not always mean an even split.

Property division in a Texas divorce is supposed to be equitable -- but not necessarily equal. To achieve a truly fair divorce settlement, a full and accurate valuation of assets and debts is needed.

At the Law Office of Mark M. Childress, we help divorcing spouses in the Fort Worth area protect their property rights and interests by obtaining comprehensive property valuations. We also help our clients trace the existence of property to determine whether it is community or separate property.

To learn more about these matters, please see our overview of property division in Texas.

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