Divorce is a major decision that involves thoroughly (and, often, painfully) dismantling a life that you may have spent years building with someone else. If you are considering divorce or are going through a divorce in Texas, you likely have very valid concerns about how your property will be divided. It is scary wondering if the end of your relationship could also cost you your home or business. Whether you will get to keep the house, season tickets for your favorite sports team, or certain financial assets can be major sources of stress.
- Is Texas a community property state?
Yes, Texas is a community property state as opposed to an equitable division state. This means that all property acquired during the course of the marriage is subject to being deemed “community property,” and divided equally between the spouses.
- What is considered separate property in Texas?
Separate property includes any assets not deemed to be community property. Separate property can be property that you owned independently before entering the marriage, property that was protected as yours individually by a prenuptial or other contractual agreement, gifts given to you by third parties, individual inheritances, and portions of personal injury settlement not compensating for damage to your family or household.
- What happens to debt in a Texas divorce?
Debt must be divided in a divorce, just like all other property and assets. Allocation of debt can be used to balance the distribution of assets in order to reach a 50-50 split of equity between the spouses. For instance, one spouse may receive a larger amount of assets, or a high-level asset, such as a home, but in exchange, assume more of the couples’ debt to balance it out. It is generally assumed that any credit taken out by either spouse during a marriage belongs to the couple as a whole. This is true even if the spouse took out an auto loan or opened a credit card in their own name. There will still be a presumption that the debt belonged to both spouses, and will be divided accordingly unless you can successfully rebut the assumption in court.
- Will I get to keep the house?
There is no one-size-fits-all answer to this question, it will depend on your specific circumstances and whether your home is separate or community property. If your home is community property the judge has significant discretion to determine which spouse retains the house based on a number of factors, however, the ultimate outcome must still be a 50-50 split. That means one spouse may keep the house as well as all debt associated with it, or one spouse may be permitted to keep the home if they buy out the other spouses’ share, or allow them to retain 50% equity.
- Who gets to keep season tickets in a divorce?
The first question is whether your season tickets are community or separate property. If the tickets were given to you as a gift by a third-party they will be considered separate property and you can keep them. If not, you may be able to keep them by offering something of equivalent financial or sentimental value to your spouse in the property division negotiations. Otherwise, it will be up to a judge to decide.
- Can I keep my engagement ring if I get divorced?
Yes. Courts have consistently held that wedding and engagement rings are gifts exchanged in expectation of marriage. Because you followed through on the marriage (even though it did not ultimately work out) the condition was met, and they will be treated as your separate property.
- How will a divorce affect my business?
If you own a business, a divorce may have a big impact. If your business is identified as a separate asset in a prenuptial or postnuptial agreement then it will be protected provided any other terms pertaining to that provision were not breached. If you started the business during your marriage and household funds or family labor was involved, it will likely be treated as community property and your spouse may be entitled to half ownership of the business and assets.
- How do I prove that property is separate?
In Texas, there is a presumption that any property acquired during a marriage is community property. In order to overcome this presumption, the burden will be on you (and your attorney) to prove by clear and convincing evidence that the property at issue was actually separate property under the law.
- Do we have to let the court determine how to separate our property?
No. Spouses always have the option of negotiating the terms of their own divorce settlement and can even utilize the assistance of lawyers, a mediator, or an arbitrator to arrive at mutually agreeable terms. If the spouses are able to agree, they must only submit their proposed terms to the court for approval. The court must only make determinations on issues that cannot be resolved by the spouses. When spouses are able to reach a resolution on their own, they retain the maximum amount of control over the process and outcome.
- How does 50-50 property division work?
50-50 property division is not as straightforward as it may sound. In reality, it involves a rather complex balancing of assets, property, and debt, which allows each spouse to receive a relatively equal share of the liquidated value of their community property. This does not mean that each spouse will get half the house, but that they will each receive approximately the same net value of assets.
Schedule a Consultation with a Texas Divorce Lawyer
If you are considering a divorce in Texas and have concerns over how it will affect your assets, the experienced divorce attorneys at the Covington Law Firm can help. The sooner you start being proactive, the sooner you can start protecting what is important to you and ensuring that you get a full and fair settlement. Contact the Covington Law Firm today to schedule a consultation.