Dividing Property & Assets in Texas

Texas is one of 9 community property states, but with a critical difference: while California mandates a 50/50 split, Texas courts divide community property in a manner that is "just and right" — which can mean an unequal division. **Community property** includes: - Income earned during marriage by either spouse - Property purchased with community funds - Retirement benefits earned during marriage - Business income and growth during marriage **Separate property** includes: - Property owned before marriage - Gifts to one spouse - Inheritances - Personal injury recoveries (except lost wages) - Property acquired after a final separation or divorce The spouse claiming property is separate bears the burden of proof by clear and convincing evidence.

Texas has uniquely strong homestead protections. The family homestead has constitutional protections against creditors and receives special treatment in divorce. **Homestead characteristics:** - Exempt from most creditor claims (except purchase money mortgages, property taxes, home improvement loans) - Up to 10 urban acres or 200 rural acres for a family - A surviving spouse has rights to remain in the homestead **In divorce:** The homestead is community property if acquired during marriage with community funds, regardless of whose name is on the title. The court can award the homestead to either spouse as part of the "just and right" division. Often, the custodial parent receives the homestead (or exclusive use during the children's minority) to provide stability for the children. If the homestead has significant equity, the court may order it sold and proceeds divided, or one spouse may "buy out" the other's interest.

Texas Family Code § 3.402 provides for reimbursement when one estate benefits another. This is important when: - Community funds paid down a spouse's separate property mortgage - Separate funds improved community property - One spouse's separate property generated income that benefited the community Reimbursement claims must be specifically pleaded — if you don't ask for reimbursement, you waive it. The claiming spouse must trace funds and prove the benefit to the other estate. Unlike some states, Texas does not provide for reimbursement for "homemaker" contributions or career sacrifices. Economic contributions (actual funds) must be traced.