One significant element of divorce is the property division negotiation.
States can divide property and assets according to one of two different
methods – community property division and equitable division. Texas
is a community property state, so it presumes that all property the spouses
acquired during the marriage belongs equally to both of them. In this
blog, we will discuss types of property included in community property
division and how a court will proceed with division.
How Is Community Property Divided?
As Texas is a community property state, most property acquired during the
marriage belongs to both spouses and must be divided during divorce. So,
all the property and earnings of both spouses obtained while married is
valued as part of the community property owned together, regardless of
whose income paid for it or whose name is on the title or contract, as
long as it was purchased between the date of marriage and the date of
Some examples of community property could be:
- income from employment, including all wages, salaries, tips, and overtime;
- the house or other real estate purchased during the marriage;
- vehicles purchased during marriage (regardless of which spouse’s
name is on the title);
- unemployment compensation and payment for lost wages;
- individual contributions to pension, 401(k), or other retirement accounts
made from the date of marriage;
- balance of checking and savings accounts, regardless of whether the account
is single or joint.
Note that each spouse is allowed to keep their separate property, which
is anything one spouse owned prior to marriage, such as individual gifts,
inheritances, or personal injury damages compensating only the one spouse.
However, all property is initially presumed by the law to be community
property until the spouse claiming that it is separate property proves
it by a preponderance of the evidence.
Regarding division, a Texas judge is required to divide community property
in a manner that is "just and right," or equitable under the
To determine what is equitable for the couple, the court may examine factors like:
- fault in the breakup of the marriage (e.g., adultery);
- the disparity of earning power between the spouses;
- each spouse's health;
- which spouse has custody of any shared children;
- each spouse's education; and
- each spouses’ future employability.
Judges must also consider a business or professional practice in division
of community property. To the extent that one spouse developed a business
or professional practice during the marriage, there is potentially a community
property interest that the court must deal with in the divorce. To learn
more, take a look at a
previous blog we wrote on businesses during divorce.
Pensions and Retirement Benefits
To the extent that a spouse accumulates an interest in a pension, retirement,
profit-sharing, or other employee benefit plan during marriage, the benefits
will be considered community property and subject to division upon divorce.
The procedure upon division will differ depending on the type of benefits.
For instance, in the case of retirement benefits, the court may order
the employer to distribute benefits to each spouse via a Qualified Domestic
Relations Order (QDRO). Alternatively, in the case of a cash account like
a 401(k), the employer will usually disburse the funds in 30-90 days.
For pension plans, the court may provide the employer with a calculation
of a percentage to be applied when payments begin and subsequently order
the employer to send the appropriate amounts to the other spouse.
Note that the court does not have to divide retirement and pension accounts
exactly equally between the spouses.
Contact the Law Office of Kathryn Marteeny for Legal Guidance
If you are currently involved in a divorce, you should prepare effectively
for property division negotiations. Because Texas is a community property
state, much of the marital property acquired during the marriage will
be up for division – even certain property you may not have expected,
such as your business or pension plans. It is best to consult an experienced
lawyer to help you gather your assets and protect your property interests
in the face of division. The Law Office of Kathryn Marteeny can answer
any legal questions you have and guide you through Texas’ community
property division process, ensuring you obtain your rightful share of
the marital property and that your property rights are being protected
in the process.
Contact the Law Office of Kathryn Marteeny
today to get started on your Houston case.