The majority of states in the US have equitable division laws, meaning a judge weighs various factors to negotiate how a divorcing couple will split their assets if the couple cannot negotiate the divisions on their own. For the most part, this means that even if property was obtained during the marriage, it isn’t necessarily subject to an even 50/50 split.
Texas is one of nine states with community property laws. This means that all marital property, i.e. any money or property earned or acquired after the marriage, belongs to both partners equally.
Rules and exceptions
Community property laws can shorten the amount of time in a divorce, but they can also create additional issues in a contentious divorce. Here’s what you should know about navigating a community property divorce:
- One spouse can contribute a portion or all of their pre-marital property or assets to the community property, in which case both parties would then have equal ownership.
- If one spouse uses personal income earned after the marriage to make a purchase or investment, the property, item, or investment becomes community property.
- In cases of larger divisions, like homeownership, one spouse will often be awarded the house, and the other will receive assets equal to the value of that house.
- Certain debts, namely education loans, do not become community property after divorce. The loan recipient bears the loan burden post-divorce.
- Personal injury compensation does not remain community property after divorce; the injured party receives the full award when the divorce is finalized.
It’s good to keep in mind that if an agreement to divide property and assets differently can be reached, a divorcing couple is not required to rely on community property laws. Community property laws exist simply to give a framework in the event that a couple must rely on a neutral third party to help make those decisions.