Dividing Community Property in a Divorce Proceeding

 Posted on July 26, 2016 in Complex Property Litigation

Divorces are notorious for being time-consuming, emotionally draining, and financially taxing. Unfortunately, in Texas, this is often exacerbated by the unique legal process required to divide community property. In many cases, most of a couple’s assets fall under the category of community property and an unfair division could be devastating, so if you or a loved one is considering a divorce, it is vital to speak with a complex property litigation attorney who is familiar with the process and will aggressively represent your interests.

Separate Property v. Community Property

The Texas Constitution specifically defines separate property as any property that was:

• Owned or claimed by the spouse before marriage;
• Acquired by the spouse during marriage by gift or as an inheritance; and
• Recovered by a spouse during marriage for personal injuries, although this does not include any compensation ordered for the loss of earning capacity.

Community property is described as consisting of any property, other than that deemed to be separate property, that was acquired by either spouse during the course of the marriage. Furthermore, in Texas there is a presumption that any property owned by either spouse during or on the date of the dissolution of marriage will be considered community property. If a spouse disagrees, he or she must show by clear and convincing evidence that the property is separate.

Inception of Title Rule

One of the ways that Texas courts determine whether an asset qualifies as separate or community property is through application of the inception of title rule. This rule allows the court to look at a property’s character at the moment that it was acquired, or when a right of claim was established. All events affecting that property after the right of claim are deemed irrelevant.

In some cases, courts use a method known as tracing to determine the character of an asset by tracking the source of the funds used to purchase it. This makes it especially important for spouses to keep complete records of all major property transactions. However, when no clear records exist to help determine what belongs to whom, the court will label the assets as commingled. At this point, the community presumption kicks in, marking all commingled assets as community property.

Just and Right Division of Property

The designation of property as either separate or community is important because during divorce proceedings courts order a “just and right” division of all community assets. However, this does not mean that the couple is entitled to an equal split of the property.

Contact an Experienced Complex Property Litigation Attorney Today

The division of property is one of the most important and difficult aspects of any divorce, so if you are considering a divorce and have questions about the possible division of your property and you live in Williamson County, Texas, specifically the Round Rock, Georgetown, Cedar Park, and Leander areas, please contact an aggressive Georgetown property litigation attorney at Powers and Kerr, PLLC at 512-610-6199 and we will help you schedule a consultation.

Source:

http://www.statutes.legis.state.tx.us/Docs/CN/htm/CN.16.htm#16.15