Property Division In Divorce
Any divorce will involve a number of different issues, but few can be as contentious as dividing marital property. Many people will have incredibly hard feelings about how certain assets are to be divided, and it is common for some disagreements to lead to very contentious court hearings.
It is important to remember that Texas is considered a community property state, which simply means that all property that is acquired during a marriage is considered to be equally owned by both spouses. There are certainly a number of different exceptions to the general rule, but it can be extremely difficult for the average person to figure out how to best exercise their rights in these cases.
“At The Sparrow Law Firm we recognize that
each case is uniquely different.”
Houston Property Division Attorney
Are you in the middle of a heated dispute about marital property in regards to your divorce? You are going to want to have an experienced lawyer on your side, and we can be the voice you need in court to protect the assets that are most valuable to you and help you retain control of the property you need.
Our firm has handled scores of contested property division hearings and knows how to help you succeed with your own claim. We are well aware of the complex nature of many property division issues and can help determine the best way for you to be able to recover the property that is most important to you.
Community Property v. Separate Property
The first three statutes of Chapter 3 of the Texas Family Code make clear how Texas defines the different properties. Texas Family Code § 3.001 states that a spouse’s separate property consists of:
- the property owned or claimed by the spouse before marriage;
- the property acquired by the spouse during marriage by gift, devise, or descent; and
- the recovery for personal injuries sustained by the spouse during marriage, except any recovery for loss of earning capacity during marriage.
Conversely, Texas Family Code § 3.002 establishes that community property consists of the property, other than separate property, acquired by either spouse during marriage. Under Texas Family Code § 3.003, property possessed by either spouse during or on the dissolution of marriage is presumed to be community property, and the degree of proof necessary to establish that property is separate property is clear and convincing evidence.
Texas Family Code § 3.101 states that each spouse has the sole management, control, and disposition of that spouse’s separate property. Under Texas Family Code § 3.102(a), however, during the marriage, each spouse has the sole management, control, and disposition of the community property that the spouse would have owned if single, including:
- personal earnings;
revenue from the separate property;
- recoveries for personal injuries; and
- the increase and mutations of, and the revenue from, all property subject to the spouse’s sole management, control, and disposition.
Texas Family Code § 3.102(b) provides that if community property subject to the sole management, control, and disposition of one spouse is mixed or combined with community property subject to the sole management, control, and disposition of the other spouse, then the mixed or combined community property is subject to the joint management, control, and disposition of the spouses unless the spouses provide otherwise by power of attorney in writing or other agreement.
Texas Family Code § 3.401 defines the marital estate as meaning one of three estates:
- the community property owned by the spouses together and referred to as the community marital estate;
- the separate property owned individually by the husband and referred to as a separate marital estate; or
- the separate property owned individually by the wife, also referred to as a separate marital estate.
All of that said, Texas Family Code § 7.001 provides that in a decree of divorce or annulment, the court shall order a division of the estate of the parties in a manner that the court deems “just and right,” having due regard for the rights of each party and any children of the marriage. Just and right does not mean completely equal or a 50-50 split. Instead, property division must be equitable based on the circumstances.
This means that the court can take a number of factors into deciding how property will be divided, and these may include, but are not limited to:
- Each spouse’s level of education
- The amount of money each spouse is capable of earning
- Business or employment opportunities available to each spouse
- The gap there between how much one spouse makes and how much the other spouse makes
- Each spouse’s health
- Each spouse’s age
- The need for future support
- Child custody award
- Personal financial situations
- Length of marriage
- Fault for the end of the marriage
- Possible draining of assets
- The nature of the property to be divided
- Tax consequences
- Attorney’s fees
One very complicated area of marital assets can be retirement accounts, such as pensions of 401(k) accounts. In such cases, premarital contributions are very well considered separate property while marital contributions are community property. The court may have to categorize these assets into separate and community property before dividing the accounts.
Spousal maintenance, or alimony, may be sought during property division, but it is important to note that Texas Family Code § 8.051 establishes that a court can order maintenance for either spouse only if the spouse seeking maintenance will lack sufficient property, including the spouse’s separate property, on the dissolution of the marriage to provide for the spouse’s minimum reasonable needs and:
- the spouse from whom maintenance is requested was convicted of or received deferred adjudication for a criminal offense that also constitutes an act of family violence committed during the marriage against the other spouse or the other spouse’s child and the offense occurred within two years before the date on which a suit for dissolution of the marriage is filed, or while the suit is pending; or
- the spouse seeking maintenance is unable to earn sufficient income to provide for the spouse’s minimum reasonable needs because of an incapacitating physical or mental disability, has been married to the other spouse for 10 years or longer, and lacks the ability to earn sufficient income to provide for the spouse’s minimum reasonable needs, or is the custodian of a child of the marriage of any age who requires substantial care and personal supervision because of a physical or mental disability that prevents the spouse from earning sufficient income to provide for the spouse’s minimum reasonable needs.
Under Texas Family Code § 8.053, it is a rebuttable presumption that maintenance is not warranted unless the spouse seeking maintenance has exercised diligence in earning sufficient income to provide for the spouse’s minimum reasonable needs or developing the necessary skills to provide for the spouse’s minimum reasonable needs during a period of separation and during the time the suit for dissolution of the marriage is pending.
Complex Property Division Issues
Property division can involve a whole host of different items, and many assets can prove far trickier to divide equitably than some might originally imagine. Complicated pieces of property that our firm has experience dividing include:
- Shared homes
- Life insurance policies
- Retirement accounts
- Family businesses
- Brokerage accounts
- Financial accounts
- Trust assets
- Partnership interests
- Gifts and inheritances
- Boats, cars, and other recreational vehicles
- Stock in closely held corporate entities
- Intellectual property
When one spouse began a business while married, they can be stunned to learn that it is considered community property even when the other spouse had no active role in running the business. In such cases, a business valuation expert is often required and the spouses need to decide if both will continue to have a financial interest in the company or if one will buy out the other.
Marital property agreements (or post-marital agreements) can be popular solutions to some of these issues, and these agreements allow the spouses to put their wishes in writing and sign the agreement. In some cases, this will allow community property to be converted into separate property by exchanging the community property between the spouses.
A marital property agreement could also agree that certain assets should be considered separate property and not subject to community property division. You will want the help of a skilled attorney in crafting a workable marital property agreement.
“Don’t Be Afraid Of Bankruptcy in Texas”
Ikaha M. Sparrow
Texas Property Division Resources
General Information – Community Property – Guides at Texas State Law Library — Visit this website to learn more about community property laws in Texas. The website also helps explain community property in “plain English.” You can also find various e-books.
Marital Asset and Debt Division Worksheet – LegalZoom — View a worksheet from the legal website LegalZoom that makes it easier to complete a marital property section of any questionnaire. Areas are broken into real estate, furniture and household items, vehicles, financial assets, retirement and pension accounts, other assets, marital debt, and spousal support. Each item has blank spaces for descriptions, values, and division between the spouses.
Contact a Property Division Lawyer in Houston Today
If you are currently struggling to divide your property for your divorce, know that you do not have to handle all of the frustration on your own. The Sparrow Law Firm, PLLC can be by your side and help you determine the best way to divide your assets.
Call 281-973-0431 or contact us online today to let us examine your situation and provide the advice you need to get the most beneficial resolution to your issues. Our firm will work closely with you throughout the entire property division process so you never feel as though you are on your own in dealing with any aspect of this very trying process.