Getting divorced means that you need to be able to identify the areas of the case that are most important to you and your family. The trouble with doing that is the reality of the situation is you have likely never been through a divorce and neither has your spouse. What you are left with is a situation where you are relying upon information provided to you by friends and family about their divorce and what was important in that case. Or worse yet- you may be in a position where you are having to rely upon second or third-hand information from people whose cousin got a divorce twenty years ago in a state far away from Texas. Not necessarily the most beneficial use of your time.
The fact of the matter is that your divorce is unique. This shouldn't come as much of a surprise given the reality that you are one of a kind! I don't mean to tell you this as a sort of motivational poster hanging in your middle school math classroom. Rather, you are being different from everyone else is just the plain old truth. What matters most to you in a divorce will be different from anyone else who gets divorced. Your circumstances, approach, and attitude towards the divorce will be different, as well. This limits the ability of other people to be able to completely guide you in divorce given that their case was different than yours.
What you need to do is get your hands-on information. He or she who has the most information in a divorce usually ends up doing better than the spouse who lacks information but has plenty of hostility. This is the tough part for many people to get their heads around. It is normal to be upset, frustrated, and angry at your spouse as you head into a divorce. However, using all that animosity towards one another is not likely to yield favorable results for anyone. It is likely to yield negative results as they pertain to the future of your family.
Instead of getting madder and madder at your spouse, I think it is a good idea for you to use your time more productively. Emotions are a good thing to have and negative emotions towards your spouse currently are perfectly normal. But to say that those emotions are going to help you in your divorce would be a stretch. Negative emotions are probably what has led you to read a blog post on a family lawyer's website, but they aren’t likely to help you in the divorce itself.
Keep reading. That's my words of wisdom. Keep working to build your stockpile of knowledge. If you can do that you will be prepared for whatever your divorce throws at you. Divorce cases have a way of surprising even the most experienced of attorneys. The more complicated your case is the more surprises you may encounter. That is not something you can control. What you can control is your attitude and your ability to present your case and know what matters most to you. That is where you can benefit from collecting information and preparing as diligently as possible before the case begins.
Community property basics
Today’s blog post is going to focus on community property. In a divorce case, there are two main categories of subject matter that you and your spouse will need to wade through to get divorced from one another. The first is child custody and conservatorship issues. If you are a parent, you have twice the number of issues to concern yourself within a divorce as a person who does not have children. This means that you probably have twice the amount of information that you need to learn to proceed confidently in a divorce.
The other area of your divorce besides children's issues is property division. In every state in the country, married people getting divorced will concern themselves with property division. However, being a Texan means that you have some different circumstances to consider when it comes to property division compared to another person in a different state. The way that our state handles property division in a divorce scenario differs from how most other states handle similar circumstances. Let's spend some time discussing how Texas handles property division before we get into what the valuation of property is.
Texas is a community property state. The term community property refers to how the state will treat property at your death or in the event of a divorce. When you consider how a judge will divide property in your divorce you must understand at least the basics of community property laws in Texas. What you have heard from other people in other places about divorce could mean very little when it comes to property division unless that person got divorced in Texas.
We should start by discussing how the presumption in Texas at the time of a divorce is that all property owned by you and your spouse is community property. This is important because all community property is subject to being divided up in your divorce. Almost without a doubt you and your spouse own property that is not going to be divided in the divorce. This is because you probably own property that you acquired before the marriage, inherited from someone during your marriage, or were gifted property specifically to you during the marriage. These are the main ways that property is classified as separately owned and thus not eligible for division in the divorce.
Think of it this way: take out a piece of paper and draw two lines vertically from the top of the paper to the bottom. Start the first line about a third of the way from the left side of the paper. When you’re done with that line draw another a third of the paper’s width from the first line. You should have three columns on the piece of paper. At the top of the first column write “community property.” On the top of the second column write “my separate property.” On the top of the third column write “their separate property.” These are the designations that you will need to contend with in your divorce case. Also- by doing this before your divorce even begins you would have put more effort into preparing for your case than 90% of people who get divorced.
Community property, depending on the length of your marriage, will be the lion's share of the property that you own. If the property was acquired during your marriage, it is likely to be community property and thus subject to division in your divorce. It does not matter whose income was used to purchase the property. If it was purchased during the marriage with income earned from your or your spouse’s place of employment, then you are dealing with a community property asset. For many people, this is a tough reality to have hammered home. Let's talk about it some before we get into the meat and potatoes of valuing property for your divorce.
What’s yours is mine, and what’s mine is yours
Undoubtedly you have heard the above expression a time or two in your life. Usually, it pertains to a situation where you and your spouse are receiving marriage counseling before actually getting married. The counselor or therapist is trying to help hammer home the idea that married people share what they own. There is no more "mine" and "yours" in a marriage- despite current trends to keep things like bank accounts separate from one another. Rather, when you get married to another you decided to cast your lots together- for better or worse.
If you are a professional who earns a great salary, then good for you. It takes a lot of time and effort to gain the education and experience necessary to succeed in the world to the extent that you have. You may have delayed buying a house, having children, getting married, or a long list of other things to put yourself in a position to do what you are doing all. All the rewards of having that type of career have allowed you and your family to experience things that many have never been able to do.
If you are a stay-at-home parent or spouse, then good for you. It takes a lot of effort to raise children and maintain a home. Think about all the things you do each day- transporting children, caring for a baby, cleaning a home, cooking, etc.- and how much money your spouse would have to pay to get those things done if it weren’t for you. You not only provide help to your spouse and your family, but you provide services as well. In an economy, we pay money for goods and services. Your spouse hasn't paid you for anything but there is no doubt that the services you provide your household have value just like the services that your spouse provides have value. The main difference, of course, is that your spouse is paid money for the services he provides to others in the marketplace.
This is all to say that you and your spouse both contribute economically to your household even if only one of you works outside the home. Remember this lesson because it is going to come in handy during your divorce. It comes as a shock to most people in a divorce scenario to find out that the spouse who earns less money or who may not even earn an income at all has just as much of a claim to the Community property in the divorce as a spouse to earn all of the income that purchased the property.
To some, this may seem unfair. Why should the spouse who never left the home to earn come have a claim to the property in the same way that the spouse who did leave the home income does? For one, we have already seen how both you and your spouse likely have contributed in positive ways to the economics of your family. You cannot just measure the success of a family and their finances based on the spouse who earns more money. Both you and your spouse have contributed economically towards the success of your family. The Community property laws in Texas seek to acknowledge that reality.
The other consideration that you need to make is that Your spouse may have worked early on in your marriage and helped you develop the time necessary to complete your education period, for example, I have worked with many families where our client worked as a waitress, secretary, schoolteacher or another profession while their spouse attended medical school, law school or something similar. These folks sacrificed for the betterment of their family’s future. Again, this is the way that I think the Community property laws of Texas acknowledge this reality. It is not just the spouse with a high-paying job that should be able to leave a marriage with the property. At least, that is how I look at the Community property laws of Texas.
To sum everything up, if you want to assert that a particular piece of property is yours separately then you will potentially have to provide evidence to back up that assertion. Things like receipts, title documents, and things of that nature will be relevant in this regard. No, I do not mean that you must show a receipt for every shirt or dress you purchased to provide proof that it is separately owned. Things like that typically are not fought over intensely. However, there may be a gift or other item that you acquired during the marriage that you will need to show proof of how it was acquired for it not to fall into the Community property category. Even property purchased around the time of your wedding may come into question as to whether it belongs in the community or separatist states.
If anyone is reading this blog post and has not yet gotten married, then you may be interested in a prenuptial agreement. Prenuptial agreements allow you and your fiancé to be able to work through issues related to property division before your marriage. Doing so puts you in a position where you can consider your options and come up with a plan on how to divide this property when you are not upset with each other and on the precipice of a divorce. If you are not able to negotiate a marital or pre-marital property agreement then you may be in a position where it becomes necessary for you to hire A forensic accountant or other professional to go back and begin to look at the property, when it was acquired and its value for your divorce case.
What is the valuation of property in your divorce?
Now that we have covered what property division means in a Texas divorce, we can begin to consider the next steps. The next steps in this equation revolve around something called inventory and appraisement. And inventory and appraisement involve going through all of your property and inventorying it all. I'm sure there are complicated ways to do this you can even walk through your home and start jotting down the things you see. Taking photographs of each room, closet or even dresser drawer is appropriate. You never know what may happen to the property or if you'll even have access to the property during the divorce. For that reason, diligent inventory is important to take.
Once you have done an inventory on your property you should do your best to determine how that property will be classified. By this I mean you can walk through the property and begin to figure out whether it belongs in your separatist state, the separatist stated your spouse or the community is the state. We have just seen how that issue impacts the entirety of your divorce case. The better you can decide on this type of information the more prepared you will be to negotiate.
Finally, the last step in preparing for Community property aspects of your divorce is to decide on what this property is worth in terms of dollars and cents. Nobody is asking you to spend any money to make these determinations. Rather, you can at least begin to estimate what you think the value of the property is and prepare for the part of your case where you will be negotiating on the Community property division. The better idea you can have on the valuation of each item and where each item falls as far as being community or separate property the better prepared you will be for your case.
Questions about the material contained in today's blog post? Contact the Law Office of Bryan Fagan
If you have any questions about the material contained in today's blog post, please do not hesitate to contact the Law Office of Bryan Fagan. Our licensed family law attorneys offer free of charge consultation six days a week in person, over the phone, and via video. These consultations are a great way for you to learn more about the world of Texas family law as well as how your family circumstances may be impacted by the filing of a divorce or child custody case.