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How does a high-asset divorce work in Texas?

On Behalf of | Jan 26, 2024 | Property Division

A high-asset divorce in Texas often involves complex issues often not present in regular divorces. In the state of Texas, the law of community property exists. This law generally presumes that all assets accumulated during a marriage should be divided equally between spouses, unless such an arrangement would not be equitable/fair.

When deciding how to divide assets in a litigated case, the court takes into consideration the entire estate instead of weighing which spouse contributed more to the marital asset pool.

Each person’s premarital possessions that are not part of the marital estate are still considered their personal property and are not subject to division. Gifts and inheritances received during the marriage may also qualify as separate property as long as they haven’t been comingled. To avoid having their separate property divided among the marital estate, the person claiming it must be able to demonstrate to the court that it is, in fact, separate.

With all of this said, it is important to underscore that property division agreements reached by the parties without judicial intervention can be structured in virtually any way in which the parties choose.

Community property vs. separate property

Due to Texas’ asset partition law, it’s essential to differentiate between separate and communal property in litigated divorce proceedings.

Yet, it’s also important to note that the aim is to establish a fair distribution of assets. To do this, the court must take into account the specific needs and contributions of each spouse. This includes determining the type of asset being divided and how child custody and spousal support will be handled post-divorce. Insurance policies, debts, the marital home and Social Security benefits are also taken into account.

Texas law promotes the settlement of asset distribution and spousal support through mutual agreement between the parties involved. The court may approve an arrangement if it is deemed fair and not excessively one-sided. The complexities surrounding property division is just one of the reasons why It is advisable to seek assistance when navigating a high-asset divorce.