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Texas Property Frequently Asked Questions

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By Daryl G. Weinman, Attorney

Published:  July 17, 2004
  1. What is community property?

    2. Texas law defines community property as all of the property that either spouse acquires during the marriage, except separate property. Separate property is anything owned prior to marriage, anything inherited by one spouse, anything received as a gift by one spouse and certain portion of a personal injury recovered by one spouse.

    All property is presumed to be community property, until the party claiming that property is separate can prove it by a preponderance of the evidence.

  2. How is the community property to be divided?

    3. The law requires that the community estate be divided equitably (not necessarily evenly or 50/50). This means that under the circumstances, the division of property must be fair and equitable. There are many circumstances that the court can consider in determining what is "equitable", including fault in the breakup of the marriage, disparity of earning power of the spouses and their ability to support themselves, health of the spouses, the spouse to whom conservatorship of the child is granted, needs of the child of the marriage, education and future employability of the spouses, etc. (for a complete list, see "Equitable Division of Property" on the definitions page of this site).

  3. Can I get a portion of my spouse's pension and employment benefits?

    4. To the extent that a married person accumulates an interest in a pension, retirement, profit sharing or other employee benefit plan during the marriage, it is community property and subject to division upon divorce. If a court awards a portion of one spouse's retirement benefits to the other spouse, the attorney's will prepare a Qualified Domestic Relations Order (QDRO) to be sent to the employer, who will be ordered to distribute Spouse 1's benefits to Spouse 2 in accordance with the court's order. In the case of a cash account, such as a 401(k), the employer will usually disburse the funds in 30 to 90 days. In the case of benefits to be paid upon retirement, such as a pension plan, the employer will be given a calculation of a percentage to be applied at the time payments begin and the employer will be ordered to send the appropriate amounts to Spouse 2 in accordance with the court's order.

  4. How do the courts deal with a closely-held business or professional practices?

    5. Like any other asset, a business or professional practice must be considered in the valuation and division of community property. To the extent that a business or practice has been developed during the marriage, there is a community property interest that must be dealt with in the dissolution.

    The most difficult and time-consuming aspect in determining the value of a business or professional practice is in evaluation of "goodwill." This is the intangible value that most businesses have, which is based on the expectation of future business, bas ed on established name or reputation. If the business or practice is operated by one of the spouses, it still has a goodwill value, even if it could not be sold on the open market.

    Certified public accountant and business appraisers are hired to determine the value of a business or professional practice. The accountant or appraiser who is hired reviews the books and records of the business or practice and prepares a written report.

Last modified:  January 18, 2005 - 12:07 PM

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