How property will be divided in your Texas divorce case is likely to be one of the most discussed topics that you encounter throughout the entirety of your case. When you ultimately sit down with your spouse to negotiate through these issues you will be forced to confront several factors and circumstances in your life that may alter the way that you think. Your finances, those of your spells, the number of children you have as well as your assets and debts will all determine how this property is divided. The more you organize and work through these issues before your divorce the better off you will be when your case begins.
When it comes to property division there are also a lot of misconceptions and outright falsehoods that people talk about regarding this subject. For whatever reason, there tends to be a belief that when it comes to property division in Texas divorce cases the result is always that you and your spouse will walk away with the same amount of property. While this may be the result of your case that does not necessarily have to be true. Factors like the fault of either spouse in the breakup of the marriage, your ages, your education, your work prospects, and then the amount of separate property that either of you owns will all factor into whether Property will be divided down the middle or in a different fashion.
Dividing property in your divorce tends to be that topic that becomes quite contentious. You and your spouse may have very different views on your property including what property is included in your community and a state in which property belongs in either of your separate estates. Much of the time this discussion gets complicated because you and your spouse may each have valid arguments as to where certain property belongs. It is when the two of you have valid arguments either way that you may find yourself going before a judge for him or to play a tiebreaker.
The Texas family code walks you and your spouse through the process of how property is divided in your divorce. Family law depends on a great deal upon the specific facts and circumstances of your case. This means that a family court judge would utilize the Texas family code to help you and divide property, but your specific circumstances and the experiences of a family court judge will contribute a great deal to the ultimate decisions about how property will be divided in your case. Since your life and circumstances are unique to your family it would be impossible in a setting like this for us to be able to walk you through exactly what you will experience in your divorce as far as property division.
For that reason, I would recommend that after reading today's blog post you contact the Law Office of Bryan Fagan to set up a free of charge consultation with one of our experienced family law attorneys. Our lawyers can walk you through what it means to go through a divorce from the perspective of an experienced attorney. We can give you information about divorce and help you to see how it may apply to your case.
From there, you may decide to hire our office to represent you in your divorce case. That is where you are turning, and you can work together to create a specific plan for your case and when you can start to receive specific advice about your circumstances. Receiving practical and helpful advice and information about your specific circumstances is what you want and what you need in a family law case. Whether you have children, property, or both to divide up in your divorce case there is no set of circumstances in your divorce that cannot be improved by having an attorney to help guide you.
Although it may not feel like it, your divorce will come to an end. When the end of your divorce arrives, you will be forced to look at the remaining years of your life. A divorce is a great opportunity for you to be able to create a plan for your life moving forward as a single adult. The more diligent you are in preparing for your divorce the more secure and vibrant your future can be. Of all the positive steps that you can take to prepare for your divorce case, I can think of no more fruitful step for you to take than hiring one of the attorneys with the Law Office of Bryan Fagan.
Is all property owned by you and your spouse going to be split down the middle?
As we mentioned a moment ago, one of the great misconceptions and falsehoods that we hear about divorce in Texas is that a family court judge will always divide property down the middle because Texas is a community property state. While it is true that Texas is a community property state which encourages the equitable distribution of property that does not mean that the same circumstances will the true for your case. Equitable distribution means that property should be divided up fairly based on the circumstances and facts of your case. This does not necessarily mean that your property will be divided equally between you and your spouse.
As we just finished talking about, Texas is a community property state. Community property is subject to division by a family court judge in a divorce. Since this is a very important subject it is important to talk a little bit about the nature of Community property in a Texas divorce. It is presumed at the time of your divorce that all property owned by you and your spells is community-owned. Property owned either by you or your spouse before your marriage is presumed under the law to be separate property. Additionally, if you or your spouse acquire property during your marriage either by gift or inheritance then that property will be separate and is not divisible in your divorce case.
The specific standard that a judge will use to divide property in your divorce is a just and right division. A just and right division means that fairness is more of the aim for the family court judge than equal division. Sometimes equal is not fair being fair does not mean dividing property equally. The factors that we listed earlier in today's blog post: your ages, your education levels your employment situation, and your physical health will all play into this Justin right division of your property. One of the important factors to consider is that most of this is already determined before your divorce. It is not as if you can change most of these factors once your case is filed. For that reason, you can begin to start thinking about how these factors will impact you and your spouse should you go through with a divorce in Texas.
For example, if you have always been the spouse who worked outside the home, earning a substantial amount of income, and has a high level of education then these will be factors that may influence a family court judge to divide property such that your spouse ends up with more Community property than you do. This is especially true if you're spouse has never worked outside the home, has a relatively modest amount of separate property, and has no education beyond high school. Taken into comparison against the property that you own and your level of education then you may find that you end up with less Community property after the divorce than your spouse does.
What about inheritances? How are they treated in a divorce?
Inheritances are treated as separate property under Texas law. This means that the inheritance that you or your spouse receive during your marriage is not subject to division by a family court judge. However, one thing that you need to be aware of is that if the property that you inherit is then mixed or commingled with community property then the separate property nature of the inheritance could be lost. This means that the property could become community property and then be subject to the division after all. This could happen, for example, if that separate property inheritance is deposited into a checking account where your and your spouse's income is kept.
Also, the separate property designation of the inheritance may be lost just due to the passage of time. Imagine a situation where you inherited $20,000 from a relative who passed away during your marriage. That inheritance could be deposited into a bank account like the one I mentioned a moment ago that is jointly held with your spouse. If many years pass, then it would become more difficult for you to determine whether the property is still separate or would have changed into community property due to the passage of time.
Another interesting aspect of this discussion concerns how separate property can generate community property income due to interest growth. For example, let’s suppose that your separate property inheritance was invested and grew due to interest that has gained over the years. This growth on the initial investment (principal) would count as community property but the initial investment itself would still count as separate property. This example also illustrates just how complex community property division can get. Having an experienced family law attorney with the Law Office of Bryan Fagan by your side can help you when the going gets tough.
Another aspect of this discussion involves the hiring of a forensic accountant or other "expert" in the field of researching financial transactions. It would be entirely conceivable for the property to become an issue in your divorce. You may believe that the property in its entirety is separate. After all, isn't the principal separate property inheritance. Your spouse, on the other hand, may contend that the property has been commingled or otherwise lost its separate property nature and is thus divisible in the divorce. We have already seen how seemingly simple circumstances can become much more complex due to the passage of time and the commingling of funds. It is best to be prepared in this regard to position yourself as well as possible to retain what is rightfully yours and to have property classified properly in your Texas divorce.
Protecting an inheritance in your Texas divorce
I think it is important to note that the above examples that we ran through truly are straightforward. I wanted to give you an example of how inheritances can get tricky even in mundane situations. It does not take a leap of faith to put yourself in a position where either of the above examples that I outlined may happen to you. You have rights when it comes to your property in a divorce, but those rights are meaningless if you don't advocate for them. The worst thing that you can do is to assume that all is lost and not fight for what you believe is right. When you have an overbearing spouse and an aggressive attorney on the other side this can become a reality that you have to face.
As a result, if you have received or plan on receiving an inheritance then you should begin to work towards taking steps to protect that property in the event of a divorce. While there is not much you can do as far as offensive measures to protect this property there are defensive measures you should be aware of. What can you do to avoid putting your money into a situation where its separate property nature may be lost? Read on to find out more.
You should aim to put away that separate property inheritance and keep it out of the general usage for family expenses. This is tough, I know. That inheritance may be needed to pay bills, update items, or even make essential repairs on the home. There is nothing wrong with using the money as an account for this type of use. However, be aware that once you start to use the money in this way there are arguments to be made by your spouse that the money no longer counts as separate property. Using the money to pay debts in your marriage is another example of a community property use of these inheritance funds.
The opposite may also occur where you have a bank account opened specifically for the inheritance. For years you may have left the money alone and contributed nothing further to that account. However, if you begin to deposit community property funds into that account then it is likely that the entirety of the account would be classified as community property as a result. Again, there is nothing wrong with doing this if it is the wishes of you and your spouse that this occurs. However, if you want to maintain the separate property nature of the inheritance then you should not deposit community funds into that account.
Finally, let’s consider a situation where instead of inheriting money from a deceased relative you inherit real property. That vacation home on Lake Conroe that you inherited may have started as separate property, but it can quickly be lost to the community estate. The most straightforward way for this to occur is if you use community income to pay for expenses, taxes, and other costs associated with owning the home. The home could become part of the community estate as a result or at the very least your spouse may ask for the community estate to be reimbursed due to the funds utilized to improve or maintain the separate property inheritance.
You should aim to keep a record of all transactions regarding the inheritance. This can become tedious and seem to be more trouble than it is worth much the time. However, if you truly want to make sure that this inheritance is kept as separate property then you should consider making the effort. This can be something as simple as controlling what money is deposited into a bank account that holds the inheritance. Your bank, credit union, or other financial institution where you have an account should be able to keep online records. However, the bank may maintain records only for a few years at a time so please be sure to take advantage of the online records while they are available. Print out the records or keep a PDF version of deposits/withdrawals on your desktop.
Still, have questions? I don't blame you! This is not intended to be an all-encompassing review of issues related to divorce in Texas and inheritance funds. To find out more about your situation contact the Law Office of Bryan Fagan.
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 consultations 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 about how your family's circumstances may be impacted by the filing of a divorce or child custody case.