Division of assets is one of the most contentious parts of a divorce.
Every state mandates its own rules for how to divide assets, and Texas is a community property state.
What is a community property state?
When the process of asset division begins, the first step requires the determination of what falls under marital property and separate property. In a community property state, the court then splits assets characterized as marital property equally between the two spouses.
What is marital property?
Anything purchased during the marriage period is marital property belonging to the community, meaning you and your spouse. There are only a few exceptions to this rule.
Consider this example of marital property. If you purchase a laptop with a debit card linked to an account with your name only, the laptop still belongs to both you and your spouse, even if your spouse never used it.
What is separate property?
In Texas, the court uses three general rules to define separate property:
- Any property owned by a spouse prior to marriage belongs solely to that spouse.
- Any property given to a spouse by gifting or inheritance belongs solely to that spouse.
- Any compensation recovered for a personal injury to one spouse belongs to that spouse. The only exception is payment for loss of earning ability.
Couples from brief marriages may have very few assets and get through this process quickly. However, grey divorces often require extensive, complex consideration to divide assets.
Overall, asset division is less difficult for couples that can agree on who gets what.