Property Division 101

Property Division

PROPERTY DIVISION 101: Everything You Need to Know About Property Division

You’re walking in to meet a divorce lawyer. You have so many questions. In fact, you have written a “To-Ask” list because you know that you’ll likely forget all of the questions that have been running through your mind.

Who will get to stay in the home – me or my spouse?

How much time does my spouse get to spend with our children?

Who will get custody of the children?

Who pays for what bills?

What should I expect in court?

Can I open up a new bank account?

Can I change the locks on my home?

How will the court divide my property?

What will happen to the retirement I worked so hard to save?

Is it his/her money if my spouse is the only one employed in our marriage?

Will I have to pay alimony?

Do I have to sell my home?

There are two broad categories in Texas that you need to be familiar with to have a basic understanding of property division.

The first category is called “separate property.”

Separate property is ordinarily all of the property that cannot be divided in a divorce, though parties can make agreements outside of court to award their separate property to the other spouse. A court cannot take away your separate property and award it to your spouse. Likewise, the court cannot award your spouse’s separate property to you. Separate property is property that:

1) Either spouse owned prior to marriage;

2) Property that was given to a spouse as a gift;

3) Property inherited by a spouse;

4) Property recovered for a personal injury.This is usually an award from a personal injury lawsuit/settlement. However, note that the portion of property or monies recovered for loss or earnings is considered community property. And;

5) Property that was agreed to in writing between the spouse to remain/transform into separate property (premarital and postmarital agreements).

A spouse who makes a claim of separate property has to prove their position through documentation or evidence showing when and how the property was acquired. Also, if one spouse fails to prove that the property is separate property, the court can deem the property community property.

The second category of property in Texas is called “community property.”

Community property is any property acquired during your marriage. Community property is the property that spouses will have to divide in their divorce. When trying to decide if property is indeed community property, begin by identifying the date of marriage. Then identify any property that was acquired after your date of marriage. The list of property should include, but is not limited to, the following: real property, buildings, businesses, cash accounts, cash on hand, retirement accounts/benefits, IRAs, CDs, military benefits, government benefits, life insurance, annuities, motor vehicles, boats, airplanes, motorcycles, ATVs, jet skis, jewelry, furnishings, artwork, electronics, sporting goods, firearms, livestock, travel rewards, antiques, club memberships, stocks, bonds, gold, silver, investment properties, equipment, inventory, mutual funds, notes receivables, copyrights, domain names, mineral rights, patents, royalty agreements, trade secrets, oil and gas property, and timeshares – just to name a few. Next, ask if the property was a gift, an inheritance, or acquired from proceeds of a personal injury. If not, and assuming you do not have a postnuptial or prenuptial agreement, the property is likely community property and subject to being divided in your divorce.

Knowing what is community property versus separate property is the first step towards identifying and dividing up your property. When in doubt, ask your divorce lawyer and collect as many documents as possible to explain the factors surrounding your purchase or acquisition of the property.