If you’re headed toward a divorce and you have acquired assets during the marriage, you probably have questions about how marital property is divided in a Texas divorce, and reasonably so. In the United States, there are two systems for dividing marital property in a divorce: equitable division and community property. Texas, like California and Nevada, is one of a handful of states that follows the “community property” model.
As a community property state, all assets acquired during the course of a marriage are considered “community property,” which means each spouse has a 50% interest in the property regardless of whose name is on the title or who earned the income.
For example, let’s say that “Jill” saved $30,000 in a separate savings account while she was married to “Bill.” Although Jill’s deposits came directly from her paycheck and the bank account only had Jill’s name on it, her husband, Bill, is still entitled to half or $15,000 because the money Jill deposited into the bank account is technically community property.
What is Separate Property?
As we mentioned, marital property refers to all the income and assets that are acquired during the course of a marriage. Separate property is not subject to division in a divorce, so the question is, what is separate property? Separate property includes:
- Assets acquired by one spouse before the marriage.
- Gifts acquired by one spouse during the marriage.
- An inheritance acquired by one spouse during the marriage.
- A personal injury award received by one spouse during the marriage, with the exception of a recovery for lost earnings.
Additionally, if there is a premarital agreement that states that certain assets and income shall remain separate property, even if it is acquired during the marriage, such property shall remain separate under a valid prenup.
Debt Acquired During the Marriage
Debt acquired during the marriage is treated the same as community property; it is owed by both spouses regardless of which spouse acquired the debt. Like a couple’s marital property, their community debt will have to be divided in a divorce. If you and your spouse have community debt, we urge you to speak to an attorney from our firm about resolving joint debts and protecting your FICO score before, during, and after the divorce.
We hope you found this information useful. To meet with a caring and compassionate Richmond divorce lawyer at our firm, contact us today.