How is Property Divided in a Divorce?
A Texas divorce can be complicated. There is often a lot of conflict involved. One common area of contention is property division.
There are two main types of property division laws: equitable distribution and community property. Texas is one of nine community property states. This means that property acquired by a couple during their marriage is equally owned by both spouses, with some exceptions. Texas law assumes that all assets and debts acquired during the marriage belong to both spouses equally. This means that most property accumulated during the marriage — such as income, real estate, cars, and even retirement benefits — is considered community property, regardless of who earned or acquired it. This can have a huge effect on how property is divided during divorce proceedings.
However, not all property is considered community property. Certain assets are classified as separate property, which means it belongs solely to one spouse. These include:
- Property owned by a spouse before the marriage.
- Property received as a gift or inheritance by one spouse during the marriage.
- Certain personal injury awards.
- Items protected under a prenuptial or postnuptial agreement.
What the Law Says
Texas Family Code, Chapter 7, Sec. 7.001 outlines how property is to be divided in a divorce. It states that in a divorce, the court shall order a division of the estate of the parties in a manner that the court deems just and right, with regard to the rights of each spouse and any children involved.
What this means is that community property is not always divided 50/50. Instead, the court uses the principle of a "just and right division." The goal is to divide assets and debts fairly but not necessarily equally. The court considers various factors, including:
- Each spouse’s earning capacity and education.
- Length of the marriage.
- Health and needs of each spouse.
- Whether one spouse has custody of the children.
- Whether one spouse wasted community assets (such as by gambling or overspending).
Retirement Accounts and Benefits
Retirement accounts, pensions, and other employment benefits that accumulated during the marriage are typically considered community property and subject to division in a divorce.
Texas courts often use a qualified domestic relations order (QDRO) to divide retirement benefits.
A qualified domestic relations order (QDRO) is a court order that divides a retirement plan or pension fund during a divorce or legal separation. A QDRO can:
- Establish the right of an alternate payee (the other spouse) to receive benefits from a retirement plan.
- Assign a portion or all of a participant's benefits to an alternate payee.
- Specify how to pay child support or alimony to a former spouse.
Contact Us Today
Texas is unique in that it is a community property state. Make sure you understand what this means so you can get the best outcome possible in your divorce.
Texas family law attorney John Powell III, P.C., is dedicated to helping clients resolve their family law issues quickly and amicably. To schedule a consultation with our office, call 832-850-6095.