Dividing property is often one of the most stressful and complicated aspects of divorce. This is especially true if spouses have many assets.
The first thing that couples should know is that Texas is a community property state. How the court divides assets during divorce will depend on which property the law considers jointly owned (community property) and which assets belong to only one spouse (separate property).
What is community property?
In Texas, almost all types of assets that a spouse acquires during marriage become community property. Under the law, both spouses own community assets equally. Community property may include one or more houses, vehicles, bank accounts, pensions, investments and other types of assets, regardless of which spouse’s name is on an account or title.
What property remains separate?
During divorce, the court divides community property in a way that it considers fair and in the best interest of shared children. However, a judge may exclude certain assets from a property division decree. Separate assets that may remain the sole property of one spouse may include assets acquired before marriage, inheritances, personal injury settlements or personal gifts.
What if spouses agree on how to divide property?
If a divorce goes to trial, it is up to the judge to decide how to split property fairly. In some cases, this may involve selling certain assets and dividing the money from the sale. Unfortunately, neither side may be happy with the outcome.
Spouses may also choose to create their own property division agreement. An out-of-court agreement still requires a judge’s approval. However, a couple that can negotiate an agreement may be able to avoid major financial losses while staying in control over how to separate important assets.