Is Texas a community property state? Yes, but with a caveat. Read on for everything you need to know about community property laws in Texas.
Yes, Texas is a community property state. In the state of Texas, most property that is acquired by a married couple during the course of their marriage is considered to be community property, which is owned equally by both spouses.
This is in contrast to states that have different rules for dividing property in the event of a divorce, such as equitable distribution states, where the property is divided in a way that is deemed fair but not necessarily equal.
That said, Texas is different from other community property states because Texas community property laws state that property must be divided in a way that is "just and right" in the event of a divorce, and not necessarily in a 50/50 equal split.
When it comes to marital property and finances, there are two main ways that states handle these matters:
A crucial factor in community property states is the distinction between community property and separate property.
As noted above, most debts and property acquired during a marriage are considered community (or marital) property. But separate property is treated differently.
So what is separate property? Typically, a spouse's separate property is:
As noted above, separate property in Texas is a spouse's separate property entering the marriage; any gifts or inheritances a spouse acquires during the marriage; and recoveries for personal injuries sustained during the marriage, such as a personal injury settlement or jury award.
Community property in Texas is everything else; that is, everything that is not separate property. Texas law defines community property as all property acquired by either spouse during their marriage, except for separate property.
Indeed, Texas law states, "property possessed by either spouse during or on dissolution of marriage is presumed to be community property," so a spouse must actually prove by "clear and convincing evidence" that something is separate property.
Examples of community property in Texas include:
Remember, a key factor for all these examples listed above is that they are acquired during the marriage.
Just as marital assets must be divided in a divorce, marital debts and liabilities but also be divided. Examples of marital debts in Texas include:
Similar to assets, though, keep in mind that marital debts are debts created during the marriage. Both parties are responsible for debts taken on during the marriage, regardless of whose name is on the title or note.
Texas law states that community property must be divided "in a manner that the court deems just and right."
Thus, the court has some discretion when dividing marital property and is not required to award a 50/50 split. If the court determines that an equal division of property would not be fair, it can award a larger share of the property to one spouse.
Factors that the court may consider when determining whether to deviate from a 50/50 division include:
As with community property, marital debts are assumed to be shared by the spouses, but courts in Texas are not required to divide debt equally. Instead, Texas courts apply the same "just and right" criteria when dividing marital debts.
In some cases, spouses may agree to a different division of property than what the court would order.
The spouses can come to a mutually acceptable agreement on how to divide their property, which is then presented to the court. If the court determines the agreement is "just and right," the agreement would be approved and incorporated into the divorce decree.
If the court does not approve the agreement, the judge can either request the spouses to try again or order a hearing to determine the matter if the couple cannot reach a fair agreement.
As noted above, Texas law states that property owned by either spouse is presumed to be community property at the end of a marriage, so a spouse has to prove by "clear and convincing evidence" that something is actually separate property.
Here are several steps that you can take to support your claim in the event you need to prove something is separate property.
There are several ways that couples can avoid having their property be considered community property in the event of a divorce.
A prenuptial agreement is a legal contract that sets forth the terms for how property will be divided in the event of a divorce. In a prenuptial agreement, the couple can specify which property will be considered separate property and which property will be considered community property.
If a couple wants to keep their property separate, they should ensure that separate property is not co-mingled with community property. This means that separate property should be kept in the name of the individual spouse who owns it and should not be used to pay for expenses related to the community property, such as the mortgage or household bills.
To ensure that property is considered separate property in the event of a divorce, couples should keep detailed records of any contributions of separate property. This can include bank statements, receipts, and other documentation showing the source of the funds used to acquire the property.
No, Texas is not a 50/50 community property state.
Texas is a community property state, but the courts are not required to use a 50/50 property division. Instead, Texas community property laws state that judges must divide property in a way that is "just and right."
In other states, community property law often requires a 50/50 property division, but that is not the case in Texas.
Here are some exceptions to community property in Texas:
Spousal maintenance, sometimes referred to as alimony, is a payment made by one spouse to the other spouse to provide financial support during or after a divorce. Whether or not to award spousal maintenance in Texas is a separate consideration from community property laws.
That said, the community property division could impact a spouse's financial position and ability to support themselves, which could impact whether they are eligible for spousal maintenance in Texas.
So, is Texas a community property state? Yes, it is, but it does not require community property to be divided 50/50, unlike some other community property states.
Instead, Texas community property laws require the court to aim for a property division that is "just and right."