Texas is one of nine Community Property states, which essentially means that any property acquired during marriage is equally owned by both spouses. Sounds simple, right? Far from it. An important thing to keep in mind about property division during divorce is that it may not end up an equal 50/50, even though you are in a community property state. There are so many more moving pieces and often there are assets on the table to divide that can’t be severed down the middle, like a house.
For this article I am going to focus on two different types of property, marital and separate. We defined community property above, everything acquired during the marriage is considered marital and owned equally. What if you have property that you brought into the marriage or was gifted or inherited during the marriage, then what?
Let’s start by defining separate property.
Separate property is anything that was owned before marriage and kept in separate name, gifted, or inherited during the marriage and kept separate. Some examples would be an inheritance that was never put into an account or titled in both spouse’s name, or a savings that you had before marriage and never moved into a joint account. Seems straightforward.
Anything that is not deemed separate property is considered marital property and up for division.
As you begin to either plan or go through your divorce you want to make sure you are very clear on what is marital and what is separate. If you have a separate property claim it is best that you have evidence to back up that claim. There are additional nuances you need to be careful with here, commingling or combining separate with a joint asset, and/or separate property that has any income attached to it.
For more clarity and understanding on exactly how these factors affect your situation contact our Certified Divorce Financial Analyst® at Next Step Divorce Solutions.
Author – Tessa Elrod, CDFA®