Issues in Community Property Law in Texas

Many potential clients of the Law Office of Bryan Fagan come into one of our free of charge consultations to ask one of our attorneys a question or two regarding community property. If you are contemplating a divorce you have probably heard of community property but may not be sure of what it is exactly. Does the law in Texas mandate that all property that is in the family home at the time of the divorce is community property? Is there any way that you can claim certain property as being yours and yours alone? Let’s discuss those issues in this blog post so you have a better understanding of the issues prior to filing for divorce.

What is separate property and how is it defined in Texas?

The Texas Family Code lays out a definition for separate property. Separate property is 1) the property owned or claimed by the spouse before marriage 2) the property acquired by the spouse during the marriage by gift, devise or descent, and 3) the recovery for personal injuries sustained by the spouse during the marriage, except any recovery for loss of earning capacity during the marriage.

Ok, for a lawyer that definition alone might be enough to make sense but for everyone else living in the real world what exactly does that mean? Basically, anything you owned prior to being married, anything you got as a result of a gift from a person or an inheritance or any money you won in a lawsuit is yours and yours alone. Your spouse does not have a claim to it should a divorce become a possibility.

Now that we know what separate property is, what does community property mean?

Likewise, the Texas Family Code has a definition for Community Property as any property other than separate property which either spouse acquires during the course of the marriage. If you purchased something or came into possession of something during your marriage and it doesn’t fall under one of the previously discussed categories for separate property then it is community property.

What comprises separate property and what comprises community property is an important distinction for us to make at this point in the blog and will be even more important for you and your attorney to work out during the course of your divorce. Separate property is not divided up in a divorce, only community property is. Therefore, if you intend to prove that a piece of property is in fact separate property rather than community property you have some work to do.

How to differentiate between community and separate property

If all you knew about community property and separate property were the definitions and brief examples that I just laid out for you then it may appear that telling the difference between community and separate property would be pretty easy to do. I suppose now is as good a time as any to let you all know that when lawyers get their hands on something it usually ends up being more convoluted and confusing than it ought to be. The subject of community vs. separate property in Texas is unfortunately no exception. Our state has had community property laws on the books for nearly two hundred years and since then many, many sub-rules have been created that require modern day lawyers like me to do my best to explain those sub-rules to clients.

Property is presumed to be community property

If you or your spouse own property at the time of your divorce that property is presumed to be community property. That isn’t just a statement made by me, but rather one of those sub-rules that are now the law in Texas. This law applies to the little dresser that has your name engraved on it from when you were a little. The presumption towards community property must be overcome with evidence that you can present if necessary. Of course, it is unlikely that your spouse is going to try and fight you for every item in the home. If there is an item that you know is going to be a fight when the time comes to either negotiate a settlement or present your evidence to a judge you and your attorney had better be prepared.

How to establish a piece of property as your separate property

Look to the earliest date at which either you or your spouse are able to claim ownership of the particular piece of property that is being argued about. Whichever one of you can claim title or ownership of property will likely be the person awarded the property in a divorce. If any piece of land or a home was purchased around the time you and your spouse got married then it is especially important to figure out your dates as to when the sale was accomplished.

Another common method to prove the separate nature of a piece of property is through tracing. Tracing basically means looking at the item that you purchased prior to the marriage and determining where the funds from the sale of that property went after the marriage began. As a pretty straightforward example, if you can prove that the money you used to purchase a piece of property came from an item that was your separate property that you sold then you would be in good shape to have that piece of property awarded to you.

The devil is in the details here, however, as it is likely that the money you got from the sale of property has been mixed up with your spouse’s income or bank accounts. This is called “co-mingling”. Unless you have kept immaculate records of each deposit and withdrawal made into your jointly held bank accounts it will be extremely difficult to prove one way or another where the money came from and how it was spent. In short, be prepared to hire an expert on forensic accounting of some similar field if this will be a similar issue to one you face during your own divorce.

Community Property is Important in a Divorce. So is hiring the right Family Law attorney

The Law Office of Bryan Fagan represents clients across southeast Texas and are no strangers to difficult situations. We pride ourselves on effective and strong representation of our clients and their families. If you have any questions on the subject of community property or anything else in the field of family law please do not hesitate to contact our office. We offer free of charge consultations and we would be happy to sit with you and discuss your questions in detail.

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