Texas is one of the few community property states in the country. What does that mean? It means that any assets or debts acquired during your marriage are generally marital property and subject to division if you choose to get a divorce. Are there any exceptions to this?
Thankfully, yes, there are a few exceptions to the rule. A pre- or postnuptial agreement can protect certain assets. Outside the presence of a marital contract, there are some assets or debts that the state may consider separate property even if acquired during your marriage. What are they?
Separate property
According to current laws, the state presumes that all property obtained by either spouse during a marriage belongs to both spouses unless either party can prove a specific asset or debt qualifies as separate property. The following assets and debts are generally separate property in the state of Texas:
- Inheritances
- Gifts
- Family heirlooms
- Debts acquired before marriage
- Property acquired before marriage
Now, items such as gifts or inheritances may be shared property if a commingling of assets occurred — such as money placed in a joint account or used to benefit both parties.
Know what you have
While the purpose of community property laws is to ensure each party walks away with their fair share of marital assets, it only works if you know what property you have to begin with. Unfortunately, spouses who fail to take an active role in handling marital finances may be unaware of accounts and other assets that exist. If you don’t know what you have, you won’t know what to ask for. It will only hurt you in the end.
Do a little digging
Legally, each spouse is required to supply a list of known assets before the property division phase of divorce. This way, everything is on the table. Hopefully, both parties are honest, but if you have concerns or feel the list is incomplete, don’t be afraid to do a little digging and ask questions. Your attorney or a forensic accountant may be able to help you identify any missing assets.
Fight for a fair property division settlement
In most cases, couples can reach agreeable terms through the negotiations process — either through private negotiations or an alternative dispute resolution method, such as mediation or collaboration. If, however, you are not, you may take the matter to court and let a judge weigh in on the matter.