When you and your spouse divorce in Texas, you must agree on division of property and debt. Because the state follows community property law, the court will divide most assets and liabilities evenly.

Before filing, learn more about how divorce may affect your financial future in terms of property division.

Community vs. separate property

Texas assumes that all property either party owns is community property unless he or she proves otherwise. Separate property may include assets either person owned before getting married as well as personal injury settlements, inheritances and gifts that only one spouse receives. Interest earnings on separate investments are also separate property. Debt that one spouse accumulates before the marriage, such as student loans, is also separate.

Retirement pensions fall under community property, and the judge may issue a Qualified Domestic Relations Order, which requires your employer to divide the assets between the spouses. If one partner owns a business, the growth of the company during the marriage may constitute community property even if the company predates the marriage.

Considerations in property division

When divorcing spouses cannot agree on property division, the court will determine equitable division based on what is “just and right” under the law. Allowable considerations include:

  • Each person’s income and future income potential
  • Each person’s education and job experience
  • Custody of minor children, if applicable
  • The mental and physical health status of each party
  • Fault in the divorce
  • Whether a significant disparity exists between the parties’ income or earning potential

Each spouse is also entitled to his or her personal property, such as clothing, work equipment and supplies, and other belongings. However, valuable items such as real estate, art, vehicles and furniture are subject to division.

If you have separate property such as a business, a prenuptial or postnuptial agreement can help ensure that it remains separate property during the marriage. The judge will issue a final decree of divorce that lists the legally binding division of property and debt.