Community Property

Community Property in Texas

In Texas, property owned by a married couple is classified as either community property or separate property. Separate property encompasses any property owned by either spouse prior to the marriage and property that is specifically identified as separate property in a prenuptial or postnuptial agreement. Moreover, gifts from third parties, inheritances, and damages awarded in personal injury cases are generally considered separate property, except when the damages are meant to compensate for the loss of earning capacity. Gifts between spouses and any income generated from those gifts are also deemed separate property.

In situations where the spouses disagree regarding the nature of an asset, or when an asset involves an intermingling of both separate and community property, it may be necessary to hire a forensic accountant to trace the origins of the asset. If you are facing a divorce, it is important to understand the potential financial implications, and a skilled divorce attorney can help you navigate this complex area of law and work with the appropriate professionals to support your case.

Community Property and Texas Laws

While Texas is a community property state, it does not necessarily mean that community property will be divided equally in a divorce. Instead, the court is required to divide the community property in a manner it deems equitable and just. To achieve this, the court considers several factors, such as each spouse's earning capacity, income, education, and employment prospects. Additionally, the court may assess fault in the demise of the marriage, the health of the spouses and their children, the primary caretaker of the children, and the division of custody if there are children involved. Moreover, if one spouse is obligated to pay spousal support, the court may consider this obligation when dividing assets equitably.

What is Community Property?

Community property broadly refers to any property, including income, interest, and real estate, that is acquired by either spouse after the marriage commences and is not delineated as separate property. Community property is equally owned by each spouse and is subject to division during a divorce. The law presumes that any property obtained during a marriage is community property. Therefore, if either party disputes the nature of an asset, he or she must provide clear and convincing evidence that it is separate property. This is a higher burden of proof than preponderance of the evidence but a lesser burden than beyond a reasonable doubt. Essentially, it means that the evidence must be sufficient to allow the fact-finder to form a firm belief as to the truth of the allegation.