How is Property Divided in a Texas Divorce?
If you are facing the end of a marriage in the Lone Star State, one of the most pressing questions on your mind is likely, “How will we divide everything we’ve built?” From the family home in Alamo Heights to retirement accounts and even debt, the division of property in a Texas divorce is a complex process governed by specific state laws.
At Barton & Associates, Attorneys at Law, with offices in San Antonio, Austin, and Corpus Christi, we guide clients through these turbulent times with clarity and aggressive advocacy. Our team understands that property division isn’t just about assets; it’s about securing your financial future. In this guide, we’ll break down the key concepts of Texas property division law, helping you understand what to expect and how to protect what’s yours.
The Cornerstone: Community vs. Separate Property
Texas is a community property state. This legal framework is the foundation for everything in a divorce. It means that all property and debt acquired by either spouse during the marriage is generally considered to belong to both of you equally. However, this doesn’t automatically mean a 50/50 split. Instead, Texas law requires a division that is “just and right,” which takes into account a variety of factors we’ll discuss later.
The first and most critical step is distinguishing between community property (subject to division) and separate property (not subject to division).
What is Community Property?
Community property is the default classification for anything acquired during the marriage . This includes:
- Income: Salaries, wages, and bonuses earned by either spouse during the marriage.
- Real Estate: A house or land purchased with marital funds, regardless of whose name is on the deed.
- Retirement Benefits: The portion of 401(k)s, IRAs, pensions, and military retirement earned during the marriage.
- Personal Property: Vehicles, furniture, and other items bought with community income.
- Debts: Credit card balances, loans, and mortgages incurred during the marriage are considered community debts.
What is Separate Property?
Separate property belongs solely to one spouse and is generally not divided by the court. Under the Texas Family Code, separate property includes:
- Property owned before marriage: Anything you owned before saying “I do.”
- Gifts and inheritances: Property given to one spouse as a gift or inherited by one spouse, even during the marriage.
- Personal injury recoveries: Money received for personal injuries (except for lost wages or medical expenses, which are community property).
The Burden of Proof: “Clear and Convincing Evidence”
A key concept in Texas divorce is the presumption of community property. The law presumes that all property in your possession at the time of divorce is community property . If you claim an asset is your separate property, the burden is on you to prove it by “clear and convincing evidence”. This requires strong documentation, such as:
- Bank statements showing a pre-marital balance.
- A deed or title dated before the marriage.
- A will or trust document proving an inheritance.
This is where things can get complicated, especially with commingling—when separate funds are mixed with community funds in a joint account . If you deposit an inheritance into a joint account used for daily expenses, tracing those funds becomes difficult, and you risk them being reclassified as community property. This is why having a skilled San Antonio family law attorney from a firm like Barton & Associates is essential.
How Does a Court Decide What is “Just and Right”?
Once all property is characterized, the court must divide the community estate in a manner it deems “just and right” . This is not simply a mathematical 50/50 split. It is an equitable division based on the unique circumstances of your case.
Texas courts consider a variety of factors to determine a fair division, including:
- Length of the marriage.
- Each spouse’s earning capacity, age, health, and education.
- Each spouse’s contributions as a homemaker.
- The needs of any children (which can influence who gets the family home).
- Fault in the breakup of the marriage (e.g., adultery, cruelty, or abandonment can be considered).
- Each spouse’s separate property holdings.
- Tax consequences of the property division.
- Debts and liabilities of each spouse.
For example, a judge might award a larger share of the assets to a spouse who has significantly lower earning potential after a long marriage or who has primary custody of the children.
Handling Specific Assets in a Texas Divorce
Different assets come with their own sets of rules and challenges. Here’s what you need to know about some of the most common and valuable ones.
1. The Family Home
The house is often the most significant asset. Several options exist for dealing with it:
- Sell the home: The court can order the house sold and the proceeds (after paying off the mortgage and costs) divided between the parties .
- One spouse buys out the other: One spouse can keep the home by paying the other their share of the equity. This often requires refinancing the mortgage to remove the other spouse’s name from the loan. Crucially, if your spouse keeps the house but your name remains on the mortgage, you are still liable to the lender if they fail to pay.
- Delayed sale: In some cases, especially when children are involved, the court might allow the custodial parent to remain in the home for a set period (e.g., until the children graduate high school) before it is sold.
2. Retirement Accounts and Pensions
Retirement benefits earned during the marriage are community property . Dividing them can be tricky. For most employer-sponsored plans like 401(k)s and pensions, a special court order called a Qualified Domestic Relations Order (QDRO) is required. The QDRO instructs the plan administrator on how to divide the account without triggering early withdrawal penalties. IRAs are typically divided using a transfer incident to divorce, which also avoids penalties if done correctly.
3. Business Interests
If you or your spouse own a business, its characterization and valuation can be highly contentious.
- If the business was started during the marriage, it is generally community property.
- If the business was owned before the marriage, it is separate property. However, any increase in the business’s value during the marriage due to the efforts of either spouse (or community funds) is likely community property.
- Determining the value of a business often requires hiring forensic accountants and business valuation experts.
4. Debt Division
Dividing debt is just as important as dividing assets. While the court can order one spouse to pay a particular debt, this does not erase the other spouse’s obligation to the creditor . If your ex-spouse is ordered to pay a joint credit card bill and doesn’t, the creditor can still come after you. The best way to protect yourself is to pay off and close joint accounts or require the spouse assuming the debt to refinance it solely in their name.
What if We Agree? The Power of Mediation and Settlement
Not all property divisions end up in a courtroom battle. In fact, most divorces are resolved through agreement. If you and your spouse can negotiate a fair settlement—either on your own, through your attorneys, or with the help of a mediator—the judge will almost always approve it .
At Barton & Associates, we often guide clients toward mediation. It can save time, money, and emotional stress. Our attorneys are skilled negotiators who will fight to ensure any agreement is truly in your best interest, but we are always prepared to take your case to trial if a fair settlement cannot be reached.
Why You Need Experienced Legal Counsel in San Antonio, Austin, or Corpus Christi
Navigating a Texas divorce without experienced legal representation is risky. The characterization of property, the tracing of separate assets, and the negotiation of a “just and right” division require a deep understanding of the Texas Family Code and local court procedures.
The team at Barton & Associates, Attorneys at Law has over 20 years of experience serving clients across South Texas. From our historic headquarters in San Antonio’s King William District to our offices in Austin and Corpus Christi, we provide the personalized, aggressive representation you need . We treat every case like family, ensuring you have a trusted advisor by your side through every step of this life transition.
If you are considering divorce or have questions about property division, don’t wait. Call us today at 210-500-0000 for a confidential consultation. You can also use our online Free Consultation form. Let us put our experience to work for you.
